TABLE OF

CONTENTS
DOCUMENT DESCRIPTION TAB

eToro Australia – PDS .......................................................................................................................... 2

eToro Scheme – PDS .......................................................................................................................... 29

IMPORTANT NOTICE
This document contains two Product Disclosure Statements (PDSs) which relate to the relevant
financial products and services offered on the eToro Trading Platform by either eToro Aus
Capital Limited ABN 66 612 791 803, AFSL 491139 or eToro Asset Management Limited, ABN 51
122 005 396, AFSL 319738.

You should read the information in both PDSs before deciding to invest on the eToro
Trading Platform.
ETORO AUS CAPITAL LIMITED
PRODUCT DISCLOSURE STATEMENT

Issue Date: 10 May 2023

eToro Aus Capital Limited

ABN 66 612 791 803

AFSL 491139

eToro Aus Capital Limited PDS 10 May 2023 2


Table of Contents
Section 1 – Important Information ...................... 3
Section 2 – Key Information ................................. 4
Section 3 – How to Trade ...................................... 9
Section 4 – Significant Risks................................ 17
Section 5 – Fees, charges and costs .................. 23
Section 6 – General Information ........................ 23
Section 7 – Glossary............................................. 27
Section 1 – Important
Information
1.1 This PDS
This Product Disclosure Statement (PDS) is dated 10 May
2023 and was prepared on that date by eToro Aus Capital
Limited ACN 612 791 803; AFSL 491139 (eToro Australia), as
the issuer of over-the-counter contracts for difference
(eToro Australia CFDs) (collectively, where applicable,
these will be referred to as “CFDs” in this PDS).
This PDS is to make the required disclosures and to help
you decide whether the CFDs described in this PDS are
appropriate for you. You may also use this PDS to compare
this financial product with similar financial products offered
by other issuers.
This PDS describes the key features of our CFDs, their
benefits, significant risks, the costs and fees of dealing in
them and other related information. The CFDs are leveraged
financial products so you should read this PDS and the
Financial Product Terms in full before making any decision
to invest in them.
Some expressions used in this PDS have definitions given in
the Glossary at the end of this PDS (see Section 7).
1.2 eToro Australia CFDs
This PDS covers eToro Australia CFDs traded on the eToro
Trading Platform. These OTC CFDs are derivative products
issued by eToro Australia (pursuant to the Financial Product
Terms) and are not Exchange traded products.
1.3 Your potential liability
Please especially read the “Key Information” in Section 2 and
“Significant Risks” in Section 4 for important information about
your potential liability.
Potential investors should carefully consider the significant
risks involved in trading in over-the-counter leveraged
derivatives, and understand and accept the risks of
investing in our CFDs.
Trading in our CFDs is not suitable for all investors because
of the significant risks involved (see section 4 on “Significant
eToro Aus Capital Limited PDS 10 May 2023
Risks”).
Your potential total liability for all of your CFDs is limited to
the balance in your Account.
You should carefully consider the risks of our CFDs and your
capacity to meet your obligations before investing.
This initial warning cannot set out and duplicate all of the
important information in this PDS. You should read all of this
PDS and the Financial Product Terms before making a decision to
invest in the financial products covered by this PDS. We
recommend that you contact us if you have any questions arising
from this PDS or the Financial Product Terms prior to entering
into any transactions with us. eToro Australia recommends that
you consult your adviser or obtain independent advice before
trading.
1.4 eToro Australia does not give Personal Advice
eToro Australia will not give you personal financial advice about
the CFDs.
This PDS does not constitute a recommendation or opinion that
the CFDs are appropriate for you.
Potential investors should be experienced in derivatives and
understand and accept the risks of investing in CFDs. The
information in this PDS is for general information purposes only,
so it does not take into account your personal objectives,
financial situation and needs.
This PDS describes the CFDs that are issued to you in accordance
with the Financial Product Terms. You should read all of this PDS
and the Financial Product Terms before making a decision to deal
in financial products covered by this PDS. We recommend that
you contact us if you have any questions arising from this PDS or
the Financial Product Terms prior to entering into any
transactions with us. eToro Australia recommends that you
consult your adviser or obtain independent advice before
trading.
1.5 Your suitability to deal in the CFDs
If we ask you for your personal information to assess your
suitability to deal in the CFDs and we accept your application to
deal in these CFDs, this is not personal advice or any other advice
to you. You must not rely on our assessment of your suitability
since it is based on the information you provide and the
assessment is only for our purposes of deciding whether to open
an Account for you. You may not later claim you are not
responsible for your losses merely because we have opened an
Account for you after assessing your suitability. You remain solely
responsible for your own assessments of the features and risks, all
losses and for trading with eToro Australia so you should seek
your own advice on whether the CFDs are suitable for you.
1.6 Currency of PDS
The information in this PDS is up to date at the time it was
prepared but is subject to change at any time. Any updates will be
posted on our website (accessible from www.etoro.com for the
pages for eToro Australia). A copy of this PDS can be downloaded
from the website or you can call eToro Australia to request that a
paper copy be provided to you free of charge. If the new
information is information which is materially adverse to you, we
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will issue either a new PDS or a supplementary PDS
containing the new information. If the new information is
not materially adverse to you, you will be able to find
updated information on our website at www.etoro.com or
by calling us using the contact details given below. Upon
request, we will send you a paper copy of the information
free of charge.
1.7 Contact
eToro Australia can be contacted at:
Level 3, 60 Castlereagh Street,
Sydney NSW 2000
Telephone: +61 2 8067 6002
Email: info@etoro.com.au
or through our website at www.etoro.com
Section 2 – Key Information
2.1 Key Features of our CFDs
● The CFDs are over-the-counter derivatives issued by
eToro Australia. They are not Exchange traded.
● They are for investing indirectly in a range of
instruments including for example foreign exchange
currencies, index level, commodities, metals, ETFs,
equities and cryptocurrency price movements around
the world without having to own and pay full value of
the Underlying Instrument.
● Your Account must be funded before CFDs are issued
to you. You do this by paying at least the Initial Margin
(and you should consider funding the Account in
anticipation of any fees and charges described in
Section 5).
● You remain liable to pay later Variation Margins and to
maintain the required amount of Margin Cover. If you
do not maintain the required Margin Cover or you do
not pay the required Margin call by the required time,
your CFDs can be Closed Out and you remain liable to
pay for any remaining shortfall.
● Unlike CFDs traded on an Exchange, the CFDs are not
standardised. The terms of a contract may, in eToro
Australia’s discretion, be individually tailored to the
requirements of the parties to the contract – you and
eToro Australia.
● You have no right or obligation to acquire the
Underlying Instrument itself.
2.2 Key Benefits of our CFDs
● Our CFDs enable you to take a trading position with an
exposure to a particular Underlying Instrument
without needing to buy or sell the actual full value of the
Underlying Instrument.
● Relatively low transaction costs mean CFDs are a cost
effective and convenient way of gaining exposure to
eToro Aus Capital Limited PDS 10 May 2023
the world financial markets without having to buy the
Underlying Instrument itself.
● You can use the CFDs to speculate, with a view to profiting
from market fluctuations in the Underlying Instrument. You
may take a view of a particular Underlying Instrument and
so invest in the CFDs intending to make a profit.
● You can use the CFDs to hedge your existing exposure to an
Underlying Instrument.
● You can deal in our CFDs with a view to profiting in both
rising and falling markets.
● The CFDs involve leverage which can be set by you within the
range offered from time to time for each CFD. This could
range from 1:1 to a high degree of leverage. Our CFDs
potentially let you invest a relatively small amount (in the
form of the Initial Margin) to have an exposure to the
Underlying Instrument without having to pay the full price of
the Underlying Instrument. This leverage gives you the
potential to take a greater level of risk for a smaller initial
outlay, so this increases the potential risks and rewards.
Leverage can magnify losses (see Section 4 – Significant
Risks and, in particular, the paragraph “Loss from Leverage”
at section 4.1).
● Your moneys paid as Margin are kept in the eToro Australia
client moneys trust account until invested as permitted
under eToro Australia's client money policy, or it is paid back
to you or paid to eToro Australia for fees, costs and charges
(if applicable) or if your Account Value has suffered a
Realised/Unrealised Loss.
● If your Account Value has benefited from a
Realised/Unrealised Profit, eToro Australia will pay money (or
credit) equivalent to that amount of the Realised Profit into
the eToro Australia client moneys trust account (or into a
permitted investment) for your benefit. This means your
Account gets paid cash (or is credited) for gains, even before
you Close Out your CFDs.
2.3 Key Risks of our CFDs
The key risks of investing in the CFDs are outlined below.
Please see Section 4 for further information on the
description of the significant risks.
● Leverage – The CFDs are leveraged when the amount you pay
(i.e., the total Margin and fees, charges and costs) to eToro
Australia is less than the full-face value of the Underlying
Instrument.
● CFDs are typically low margin, high leveraged investment
You should be prepared for greater risks from this kind of
leveraged derivative, including being liable to pay eToro
Australia more Margin and your Account’s Margin
Requirement changing rapidly in response to changes (e.g., in
the market for the Underlying Instrument).
● Loss of your moneys – Your potential losses on (long or
short) CFDs may exceed the amounts you pay (as Margin) for
the contract or amounts we hold on trust for you.
● Trust moneys are withdrawn to pay for the CFDs for the
Realised Loss – The money that you pay into the eToro
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 Australia client moneys trust account will be withdrawn
to pay eToro Australia for the CFDs for fees, costs and
charges or when there is a Realised Loss. The moneys
are withdrawn as payments to eToro Australia, so, once
withdrawn they are not held on trust for you and, you
lose the benefits of holding those moneys in the eToro
Australia client moneys trust account.
● Margin Cover requirements – You must have in your
Account sufficient Margin Cover so you will need to pay
Margin before CFDs are issued and, after that, you may
be liable to pay more Margin to maintain the position.
The Margin Requirement will usually be at least:
- the Margin required by eToro Australia for the
contract (initially and later); and
- the Margin required by eToro Australia to cover
any payments for Realised/Unrealised Loss on
other positions in your Account; and
- any Margin required by eToro Australia to cover
adjustments for any foreign exchange rate; and
- any Margin required before the Margin Closeout
level is triggered (see section 3.14 under “Margin
Requirement obligation” for further information).
If you do not meet the Margin Requirement for your
Account, including at little or no notice, some or all of
the CFDs may be Closed Out without notice to you.
● eToro FX CFDs which are denominated in foreign
currency can expose you to fast and large changes to
the value of your position and to your Account,
potentially triggering the need for more Margin to be
paid by you, including at short or no notice.
● eToro Cryptocurrency CFDs can expose you to fast
and large changes to the value of your position and to
your Account, potentially triggering the need for more
Margin to be paid by you, including at short or no
notice. These CFDS have other risks, such as possible
delays in closing out due to underlying illiquidity, or
volatility or early close out due to up to the underlying
cryptocurrency.
● Gapping Risk – The term ‘gapping’ refers to a situation
where a CFD opens at a much higher or lower price
than the previous close. In currency trading ‘gapping’
typically occurs when the currency re-opens for trading
after a weekend. When ‘gapping’ occurs, you may not
be able to exit an existing position at the price you
have specified; instead, your Order may be filled at the
next best price that may be better or worse.
● Execution Risk (Slippage) – We aim to provide the
best possible execution from our systems and fill
Orders at the requested rate; however, there may be
times where, due to an increase in volatility or volume
or other market conditions, some price ‘slippage’ may
occur. This generally occurs during significant news
events or ‘gapping’. Execution is also subject to
available liquidity in the Underlying Instrument. Your
Orders may not be filled due to the Underlying
eToro Aus Capital Limited PDS 10 May 2023
Instrument price moving significantly or liquidity exhausted,
in which case your Order will be filled at the next available
price.
● Execution Risk (Delays) – Execution delays may occur for a
number of reasons such as technical issues with your
internet connection to our servers. Connection strength may
vary depending on the kind of device used; interruptions
may cause a delay in the transmission of data between our
servers to the eToro Trading Platform.
● Liquidity Risk – Liquidity risk typically occurs in volatile
markets or in circumstances where there is a major news
announcement. When there is a lack of liquidity in the
Underlying Instrument, you may not be able to enter or exit a
Transaction at your requested price.
● Market Volatility – Financial markets are subject to high
volatility causing rapid price fluctuations. This is primarily
due to external influences and unforeseen events. This
affects prices and spreads of CFDs.
● System Risk – Operational risk is inherent when trading
online. Disruptions in operational processes such as
communications, computer networks or external events
may lead to trade execution problems.
● Counterparty risk – you have the risk that eToro Australia
will not meet its obligations to you under the contract. The
CFDs are not Exchange traded and your client money may be
invested in permitted investments so you need to consider
the credit and performance risk you have on eToro
Australia. This is further explained in Sections 3.21 to 3.24.
2.4 Your suitability
We may make an initial assessment of your suitability to invest in
the CFDs based on the information you give us. You should
always make your own assessment of your suitability to deal in
our CFDs. You should carefully consider the features of CFDs and
their significant risks before investing in them.
Some key suitability considerations for you are:
● whether you have experience in trading in the Underlying
Instrument;
● whether you understand the terms of our CFDs and how
they work;
● whether you accept a high degree of risk in trading in these
CFDs;
● whether you can monitor your investments and manage
them in a volatile market;
● whether you have financial resources to provide more
Margin, especially on little or no notice; and
● whether you can bear substantial losses that might arise
from trading in these CFDs, especially the potentially for
unlimited losses.
Our assessment of your suitability is based on your information
and any other information we ask and you give us.
During the Account establishment process, you will be required to
complete a questionnaire regarding the CFDs. We can only
establish your Account after you have successfully passed the
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questionnaire.
To the extent permitted by law, we do not accept liability for
your choice to invest in any CFDs so you should read all of
this PDS and the Financial Product Terms carefully,
consider your own needs and objectives for investing in the
CFDs and take independent advice as you see fit.
2.5 Nature of the CFDs
A CFD is a sophisticated over-the-counter financial
product which allows you to make a profit or loss
from changes in the market price (or level) of the
Underlying Instrument, without actually owning the
full value of the Underlying Instrument or having any
direct interest in the Underlying Instrument.
In simple terms, the amount of any profit or loss
made on the contract will be equal to the difference
between the price of the contract with reference to
the Underlying Instrument when the contract is
opened and the price of the contract with reference to
an Underlying Instrument when the contract is closed,
multiplied by the number of CFDs held.
The calculation of profit or loss is also affected by
other payments, including payments relating to
Finance Charges and any other charges (for more
information, see Section 5).
The value can also be affected by fluctuations in
foreign exchange if you make a Transaction
denominated in a currency different from the
denomination of your Account currency.
You can take both “long” and “short” positions. If you
take a long position, you profit from a rise in the
Underlying Instrument, and you lose if the price of the
Underlying Instrument falls. Conversely, if you take a
short position, you profit from a fall in the price of the
Underlying Instrument and lose if the underlying price
rises.
Dealing in CFDs does not give you any beneficial
interest in the Underlying Instrument nor any right to
acquire the Underlying Instrument itself. This is
different from direct trading in the Underlying
Instrument where you acquire a beneficial interest in
the actual financial product.
As the holder of a CFD, you do not have a beneficial
interest in the Underlying Instrument and you have
none of the rights of an investor who holds the
financial product itself.
Unlike direct investments made by trading on an
Exchange, the CFDs are not standardised. The terms
of the CFDs are based on the Financial Product Terms
with eToro Australia, which apply to your Account and
your Transactions.
2.6 Types of CFDs
2.6.1 eToro Index CFDs
eToro Index CFDs derive their price or value from the real
time changes in the value of an Underlying Index as
eToro Aus Capital Limited PDS 10 May 2023
calculated by the relevant Exchange or eToro Australia valuation
of that Underlying Index.
eToro Index CFDs can only be traded during the open market
hours of the relevant Exchange on which the Underlying Index is
determined (or within any more limited hours set from time to
time by eToro Australia ). The available hours may be viewed on
our website.
eToro Index CFDs allow you to deal in anticipated market trends
rather than individual shares.
eToro Index CFDs are valued based on the number of units per
index point of the Underlying Index. For example, if the
Underlying Index is 4600 then trading 10 eToro Index CFDs for
that Underlying Index would mean the face value of the trade
was $46,000.
2.6.2 eToro Commodity CFDs
eToro Commodity CFDs’ Underlying Instrument is the value or
price of a Commodity Transaction. eToro Commodity CFDs may be
denominated in any of the available currencies.
eToro Commodity CFDs are an easy way to gain access indirectly
to commodity markets and underlying commodities such as,
copper, wheat, sugar and oil.
eToro Commodity CFDs can only be traded during the open
market hours of the relevant Exchange on which the Commodity
Transaction is able to be traded (or within any more limited
hours set from time to time by eToro Australia). The available
hours may be viewed on our website.
2.6.3 eToro Share CFDs
eToro Share CFDs allow you to gain exposure to movements in
the price of the Underlying Instrument that you would obtain
directly from owning the share/equity itself.
eToro Share CFDs can only be traded during the open market
hours of the relevant Exchange on which the Underlying
Instrument is traded (or within any more limited hours set from
time to time by eToro Australia). The available hours may be
viewed on our website.
2.6.4 eToro ETF CFDs
eToro ETF CFDs allow you to gain exposure to movements in the
price of the Underlying Instrument, an ETF. An Exchange Traded
Fund is a marketable Instrument that tracks as index,
commodity, bonds or a basket of assets.
eToro ETF CFDs can only be traded during the open market
hours of the relevant Exchange on which the Underlying
Instrument is traded (or within any more limited hours set from
time to time by eToro Australia). The available hours may be
viewed on our website.
2.6.5 eToro Cryptocurrency CFDs
eToro Cryptocurrency CFDs allow you to gain exposure to price
movements in cryptocurrencies. The prices of the Cryptocurrency
CFDs which we quote are derived from the price feeds from
cryptocurrency exchanges or cryptocurrency Hedge
Counterparties that we deal with.
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Cryptocurrency CFDs are opened in the same way as
other CFDs. We will quote a Bid and Ask price for a
cryptocurrency rate.

eToro Cryptocurrency CFDs have the same kind of

inherent risks as other CFDs, especially those which are
over Underlying Instruments which do not have
established markets. These risks maybe amplified by
the volatility of the markets and the technological
features of the cryptocurrency. Please see Section 4.1.

2.6.6 eToro FX CFDs

eToro FX CFDs are leveraged products which derive

their prices from the real time changes in the market
price and exchange rates of foreign currencies.

Prices are only quoted for eToro FX CFDs and can only
be traded during the open market hours during which
the foreign currency is traded.

Open hours of the market are available by viewing our

website. eToro Australia might not quote for a
contract on a particular foreign currency if that foreign
currency is illiquid (for more information on the effect
of potential external disruptions, see Section 4).

eToro FX CFDs allow you to receive many of the

economic benefits of owning the full value of the
foreign exchange contract on which the eToro FX CFD
is based without physically owning it (for more
information on key benefits of trading in eToro FX
CFDs see Section 2.2). This includes CFDs in the spot
price for gold or silver which are the Underlying
Instruments.

eToro FX CFDs are valued based on the price of the

relevant foreign currency pair. For example, in the
case of eToro FX CFDs, if you bought 10,000 of one
currency against another and the price of the foreign
currency pair was quoted as 10.40/10.60 then the
eToro FX CFD would have a value of $106,000 (being
10.60 x 10,000).

For more information on which eToro FX CFDs are

available, please download a demonstration-trading
platform located on the website at www.etoro.com.

eToro Aus Capital Limited PDS 10 May 2023 7

2.7 Benchmark Disclosure

ASIC has adopted benchmarks for over-the-counter derivatives that include eToro Australia CFDs.

The benchmarks are not mandatory and are not law. ASIC has introduced them by way of stating, in Regulatory Guide 227 (RG
227), ASIC’s expectations. Not meeting the benchmarks is not an indication of breaches or failures. Rather, the benchmarks in RG
227 also require prominent disclosure in a PDS as to whether an issuer meets the benchmarks or, if not, the reasons why they are
not met are explained in the PDS.

The following table summarises the benchmarks as eToro Australia applies them to our OTC CFDs, and whether eToro Australia
meets them and, if not, why not.
The table also refers you to other Sections of this PDS for more information on relevant topics (to avoid duplicating the information
in this PDS).

ASIC RG 227 Benchmark eToro

eToro Australia believes that it meets this benchmark. An explanation
1. Client qualification
of eToro Australia client qualification policy is described in Section 2.4 –
If an issuer meets this benchmark, the PDS should “Your Suitability”.
clearly explain:

● that trading in CFDs [or other applicable

products] is not suitable for all investors
because of the significant risks involved; and

● how the issuer’s client qualification policy

operates in practice.
eToro Australia does not meet this benchmark because it accepts as
2. Opening collateral
collateral for opening an Account, payments by credit card of more
If an issuer meets this benchmark, the PDS should than $1,000 as well as payments via BPay® and bank transfer and
explain the types of assets the issuer will accept as does not place limits on credit card payments.
opening collateral.
The additional risks and costs of paying by credit card are described in
If an issuer accepts non-cash assets as opening Section 6.6 “Applications”.
collateral (other than credit cards to a limit of
eToro Australia otherwise meets this benchmark.
$1000), the PDS should explain why the issuer does
so and the additional risks that using other types of
assets (e.g. securities and real property) as opening
collateral may pose for the investor. This includes,
for example, the risks of ‘double leverage’ if
leveraged assets are accepted as opening collateral.

3. Counterparty risk – Hedging eToro Australia meets this benchmark:

If an issuer meets this benchmark, the PDS should ● eToro Australia discloses in its PDS its hedging activity and risk
provide the following explanations: mitigation (see Section 3.22).

● a broad overview of the nature of hedging
activity the issuer undertakes to mitigate its
market risk, and the factors the issuer takes
into account when selecting hedging
counterparties; and
● details about where investors can find the
issuer’s more detailed policy on the activities it
undertakes to mitigate its counterparty and
market risk, and the names of any hedging
counterparties.
● This PDS complies with the requirements to include information
about the significant risks associated with the CFDs (see Section 4)
and provides an explanation of the counterparty risk associated
with CFDs (see Sections 3.21 to 3.24).
● This PDS explains that, if eToro Australia defaults on its
obligations, investors may become unsecured creditors in an
administration or liquidation.

eToro Aus Capital Limited PDS 10 May 2023 8


4. Counterparty risk— Financial resources
If an issuer meets this benchmark, the PDS should
explain how the issuer’s policy operates in practice.
An issuer should also make available to prospective
investors a copy of its latest audited annual
financial statement, either online or as an
attachment to the PDS.
5. Client money
If an issuer meets this benchmark, the PDS should
clearly:
● describe the issuer’s client money policy,
including how the issuer deals with client
money and when, and on what basis, it makes
withdrawals from client money; and
explain the counterparty risk associated with the use
of client money for derivatives.
6. Suspended or halted underlying assets
● If an issuer meets the benchmark, the
PDS should explain the issuer’s
approach to trading when underlying eToro Australia’s discretions and how it manages its positions are
assets are suspended or halted.
7. Margin calls
If an issuer meets this benchmark, the PDS
should explain the issuer’s policy and margin call
practices.
eToro Aus Capital Limited PDS 10 May 2023
eToro Australia has in place a written policy outlining how we comply
with our financial obligations, and we ensure that we have sufficient
financial resources to meet our liabilities. - see Sections 3.21 and 3.23.
eToro Australia would meet this benchmark except that eToro
Australia makes available copies of its latest audited annual financial
statement only by inspection at the office of eToro Australia.
eToro Australia meets this benchmark.
See sections 3.11, 3.12, and the risks described in section 4.
eToro Australia does not use client moneys paid into the eToro
Australia client moneys trust account for margining, guaranteeing,
securing, transferring or for its hedging purposes. Rather, eToro
Australia uses funds from its own operating account for these
purposes.
eToro Australia meets this benchmark.
eToro Australia’s approach to trading when underlying assets are
suspended or halted is described in Section 3.3 “Dealing”.
described in Section 6.2 under “Discretions”.
eToro Australia has a clear policy in relation to Margin and our rights
to Close Out positions.
eToro Australia’s margin practice is an automated process via the
eToro Trading Platform by which the platform automatically posts
warnings to the Account if you do not maintain the Margin Cover
levels.
Nevertheless, the Financial Product Terms clearly require the Client to
maintain the minimum Margin Cover at all times. A Client must meet
the Margin Cover whether or not the Client has received the warnings
on the eToro Trading Platform (or notices from us).
eToro Australia describes its margin policy in Section 3.15 but see also
Sections 3.13 and 3.14 and the risks associated at Section 4.
9

Section 3 – How to Trade
3.1 Your Account
Before you open an account with eToro, you should read
the contents of this PDS, the Financial Product Terms and
the FSG and decide whether CFD trading is suitable for
you.
You need to establish your Account by completing eToro
Australia’s Account application form, which will be made
available for you online. By opening an Account, you agree
to the Financial Product Terms and you will become a
Client of eToro Australia. After eToro Australia accepts
your application, your Account will be established. We
may reject your Account application in our discretion.
Your Account covers all of the services and products
which you apply for in your application form and which are
accepted by eToro Australia. We will also ask you
questions that will help us assess your suitability to trade
CFDs (as outlined in section 2.4 of this PDS). If we decide
that you do not have the relevant experience, we may
recommend that you open a demo account prior to
opening a live Account.
The legal terms governing your Account and your dealing
in the CFDs are set out in the Financial Product Terms.
The Financial Product Terms also have the legal terms for
your dealings with us for other financial products that are
not covered by this PDS.
3.2 Opening a CFD
The particular terms of each CFD are agreed between you
and eToro Australia before entering into a Transaction.
Before you enter into a CFD, eToro Australia will require
you to have sufficient Account Value (see the Glossary in
Section 7) to satisfy the Initial Margin requirements for
the relevant number of CFDs. The payments you make to
eToro Australia are either held as Margin (as defined in
the Financial Product Terms) or are later withdrawn to
pay the amounts for Realised/Unrealised Losses or any
fees and charges that you may owe.
When you Close Out an Open Position, you are entering
into a new contract for a position of the same type and
number of contracts opposite to your Open Position. You
are liable for the costs, fees and charges as described in
this PDS (see Section 5). You should be aware that your
investment might suffer a loss, depending on the value of
your contract at termination compared with the total cost
of your investment up to the time of termination.
A CFD is opened by buying a contract, corresponding with
either buying (going long) or selling (going short) the
Underlying Instrument. You go “long” when you buy a CFD
corresponding with buying the Underlying Instrument in
the expectation that the price of the Underlying
Instrument to which the CFD relates will increase.
You go “short” when you transact in CFD contract
eToro Aus Capital Limited PDS 10 May 2023
corresponding with selling the Underlying Security in the
expectation that the price of the Underlying Instrument to
which the CFD relates will decrease.
3.3 Dealing
Quotes for prices for dealing in our products are indicative
only and so are subject to the actual available price at the time
of execution of your Order. While eToro Australia endeavours
to execute your Order to the best of its ability, there is no
assurance that the Order will be able to be executed at the
price of your Order.
Quotes will be given and Transactions made during the open
market hours of the relevant market on which the Underlying
Instruments are traded. The open hours of the relevant
Exchanges are available by viewing our website. Such hours
may change according to the relevant Exchange’s changes or in
our discretion.
eToro Australia may at any time in its discretion, without prior
notice, impose limits on our CFDs in respect of particular
Underlying Instruments. eToro Australia might do this if for
example (but not only) the market for the particular Underlying
Instrument has become illiquid or its trading status has been
suspended or there is or will be, some significant disruption to
the markets, including trading facilities.
You should be aware that the market prices and other market
data that you view through eToro Trading Platform or other
facilities that you arrange yourself may not be current or may
not exactly correspond with the prices for the products offered
by eToro Australia.
If you access your Account and the eToro Trading Platform
outside of the hours when Orders may be accepted, you
should be aware that the Orders might be processed later
when the Underlying Instrument is open for trading. The
market prices (and currency exchange values) might have
changed significantly by the time the Order is executed.
3.4 Pricing - Bid/Ask spread
eToro Australia quotes a lower price and a higher price at
which you can place your Order. This is referred to as the
Bid/Ask spread. The higher quoted price is the indication of
the price you can buy the CFD. The lower quoted price is the
indication of the price at which you can “sell” the CFD (that is,
Close Out an Open Position for the CFD).
A simplified example of our normal spread is calculated as
follows:
AUD/USD: 0.7379/0.7383
Spread = (Bid price – Ask price): (0.7379-0.7383) = 4 pips
Cost = (quantity x Spread): (1,000 x 0.0004) = USD 40 cents
eToro Australia’s Bid/Ask prices are set by eToro Australia and
so these prices may not be the same as those quoted in the
relevant underlying market. Please be aware that eToro
Australia does not act as your agent to find you the best
prices.
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 When your Order is executed, for you to break even or
before you can realise a profit, putting aside for the sake of
simple illustration any fees or charges, the price at which
you exit your position needs to have moved in your favour
to at least equal to the original Bid or Ask price that you
started the position (depending on whether you went long
or short).
In addition, the available pricing may be limited by tick
sizes, minimum steps, depending on the general market
rules for trading the Underlying Instrument or eToro
Australia’s hedging, so, depending on the product you
choose, your Order to exit your position might have to be
in minimum increments of pricing before it can be accepted
and executed. That could affect your net profit or loss.
3.5 Pricing model
eToro Australia offers prices based on its market
making pricing model.
eToro Australia does not draw on and use client moneys
paid into the eToro Australia client moneys trust account
for hedging with its Hedge Counterparty. eToro Australia
uses funds from its operating account for this purpose.
Generally, although the prices of CFDs on the eToro
Trading Platform are competitive, you should be aware
that eToro Australia is acting as principal to you and so is
responsible for setting the prices of opening and closing
CFDs and eToro Australia does not act as your agent to
find you the best prices.
3.6 Electronic Trading Platform
Your Account gives you access to the eToro Trading
Platform. This arranged by eToro Australia from its
affiliate. Please note that all of your dealings with eToro
CFDs are only with eToro Australia as principal in the
transaction with you.
We do not accept telephone or other voice Orders.
All of the CFDs issued pursuant to this PDS will use the
eToro Trading Platform.
We will try to use our best efforts to make the Trading
Platform available when you access them; however, we
cannot give an absolute assurance or guarantee that the
Trading Platform will be available on a continuous basis
due to systems maintenance, system failures and other
related technological or external factors.
You must carefully read and follow the operational rules
for the Trading Platform. The Trading Platform from time
to time may impose special operating rules including but
not limited to:
● posting Margin (such as when payment is required
and when the payment is effective);
● how Margins are calculated (such as automatic
adjustments outside of trading hours, including at
the weekend); and
eToro Aus Capital Limited PDS 10 May 2023
● how Orders are managed.
We strongly recommend that prior to engaging in live trading,
you open a “demo” account and conduct simulated trading.
This enables you to become familiar with the Trading Platform.
There is also online help available on the Trading Platform,
which has information relating to the operation of the Trading
Platform.
3.7 Confirmations of Transactions
If you transact in our CFDs, the confirmation of the
Transaction, as required by the Corporations Act, may be
obtained only by accessing the daily statement online, which
you can print for your records. It is your obligation to review
the confirmation of Transactions immediately to ensure its
accuracy and to report any discrepancies within 24 hours.
3.8 Distributions and Corporate Actions
eToro Australia has a discretion to adjust your Account in
respect of a dividend, takeovers and Transformations
(including events such as share consolidations/splits,
acquisitions, mergers, takeovers, spinoffs, MBOs, de-listings,
etc.) attributable to any Underlying Instrument, or a security
which is in an index used as the Underlying Instrument. We
are not obliged to make any adjustment at all or, if we do, any
kind or degree of adjustment.
We will decide and calculate any adjustment (net of any taxes
and the timing of the adjustment to your CFDs). If we make
an adjustment, we will while we always retain an absolute
discretion, we may have regard as we think appropriate to
have regard to market practice and take into account the
treatment we receive from our Hedge Counterparties or any
relevant third party.
eToro Australia may elect to close a position (without prior
notice to you) if an adjustment event occurs and it determines
that it is not reasonably practicable to make an adjustment.
eToro Australia may also elect to close an eToro Australia CFD
if the eToro Australia CFD’s Underlying Instruments are the
subject of a take-over offer, scheme of arrangement or other
mechanism for change in control, prior to the closing date of
the offer.
If the CFDs relate to an index, and a share (which is a
constituent of the index) goes ex-dividend, then typically an
adjustment will be made automatically to the index level (by
the index provider) to reflect this dividend.
eToro Australia has discretion whether to make an adjustment
at all and, if it does, for an amount for the divided (whether for
a weighted proportion of the dividend or otherwise), being an
amount to be credited to your Account in respect of your long
positions and debited from short positions. Whether the
adjustment is at all or its amount and timing remains in the
discretion of eToro Australia.
Any adjustment will be uniformly applied across all relevant
positions at the time. Please contact eToro Australia if you
have any queries on whether the adjustment will be made to a
11
 particular CFD.
You may not direct eToro Australia how to act on a
corporate action (including a dividend) or other
shareholder benefit.
eToro Australia may elect to close a position (without
prior notice to you) if an adjustment event occurs and
it determines that it is not reasonably practicable to
make an adjustment. eToro Australia may also elect
to close an eToro Australia CFD if the eToro Australia
CFD’s Underlying Instruments are the subject of a
take-over offer, scheme of arrangement or other
mechanism for change in control, prior to the closing
date of the offer.
eToro Australia CFDs do not entitle you to direct
eToro Australia on how to exercise any voting rights
in connection with the eToro Australia CFD’s
Underlying Instrument.
Clients should be aware that some Exchanges purge
orders in securities that undergo corporate actions.
You should seek confirmation from eToro Australia
of any action for specific corporate actions that might
affect your eToro Australia CFDs.
3.9 Suspensions and de-listings
If an Underlying Instrument to which a CFD
Transaction relates is suspended or has halted
trading for whatever reason, we may suspend
trading in the CFD and we may increase the amount
of Margin required to support that Open Position in
our reasonable discretion. If the Open Position
remains suspended for a time that we think is
unacceptable to us in our sole discretion, we may
Close Out the Open Position at the Closing Price.
If an Underlying Instrument to which a CFD
Transaction has been de-listed, we may Close Out all
affected Open Positions at the Closing Price in our
discretion.
3.10 No Shareholder Benefits
As a holder of a CFD, if the CFD’s Underlying
Instrument is a share or other voting security, you do
not have rights to vote, attend meetings or receive
the issuer’s reports, nor can you direct eToro
Australia to act on those rights. Other benefits such
as participation in shareholder purchase plans or
discounts are also unavailable.
3.11 Payments and Client Moneys
Here is an explanation of payments you make for our
CFDs.
A. Establishing a Position
Before you transfer any money to eToro, you should
carefully consider how your money will be held and
used and the risks to you of paying money to eToro
Australia.
eToro Aus Capital Limited PDS 10 May 2023
Please see the entire description that follows.
Steps:
Step 1
You (as our Client) pay money into the eToro Australia client
moneys trust account for Margin. You would need to do this to
fund your Account before trading if there is not enough Margin
Cover.
Step 2
CFDs are issued to you when your Orders are accepted and
executed.
No money is withdrawn from the eToro Australia client
moneys trust account just for you to open your contract.
Step 3
After you have paid money as Margin and established your
position, eToro Australia will keep the moneys which you have
paid into the eToro Australia client moneys trust account in
there (or in another permitted investment type) until it needs
to be paid for fees, charges and costs or if there has been a
Realised Loss on your Account at which point eToro Australia
withdraws funds to pay itself since these are moneys to which
eToro Australia is entitled (by reason of the terms of your
Account). Whether or not there is a Realised/Unrealised Loss on
your Account is determined when eToro Australia revalues your
Account.
Step 4
Money will be paid by eToro Australia to the eToro Australia
client moneys trust account (or another permitted investment
type) for your benefit. This occurs when the revaluation of your
Account by eToro Australia shows a Realised Profit.
Further explanation of Client moneys when establishing a
position
The above steps give a very brief outline. The following gives
further explanation.
eToro Australia client moneys trust account
Moneys paid by you to eToro Australia for the CFDs are initially
deposited into a trust account maintained by eToro, which is
referred to in this PDS as the “eToro Australia client moneys
trust account”. You make your deposit by using BPay®,
electronic or telegraphic transfer, by cheque, credit card or
other means approved by us.
eToro Australia only permits clients to trade on cleared funds.
eToro Australia recommends that when credit cards are used
as an account funding method that no more than $1,000 is
used as an initial payment; however, we do not enforce this
policy since we believe that the capping of a one-off payment is
not likely to act as a protective measure. We do however
reiterate that when dealing in CFDs you may incur a loss which
is far greater than the amount that you have paid and advise
that you not only take this into account when you are using a
credit card to make the first ever deposit into your Account,
but also for all subsequent deposits.
12
 The moneys paid by you into the eToro Australia
client moneys trust account is held for you (until they
are withdrawn, at which point they become moneys
belonging to eToro) and are segregated from eToro
Australia’s own funds. This means those funds are
not available to pay general creditors in the event of
receivership or liquidation of eToro (unless a court
orders differently).
You should be aware that, generally, for trust
accounts such as the eToro Australia client moneys
trust account:
● Individual Clients do not have separate or
segregated accounts.
● All Clients’ moneys are combined into one account.
● Moneys and other assets in the trust account
that belong to non-defaulting Clients are
potentially at risk of being withdrawn and not
being re-paid to the Client even though they did
not cause the default.
eToro Australia is entitled to retain all interest
earned on the money held in the eToro Australia
client moneys trust account.
3.12 Client Money Rules
eToro Australia will deal with client moneys in
accordance with the Client Money Rules. In short, in
relation to withdrawals from the eToro Australia
client money trust account, the Client Money Rules:
1. limit (or in many cases, prohibit) a financial
services licensees’ (including eToro
Australia’s) entitlement to withdraw client
moneys from its client money trust
account:
● for the licensee’s use for working capital;
● for the licensee meeting obligations
incurred by it other than on behalf of
the client; and
● for the purpose of the licensee entering
into, or meeting obligations under,
transactions that the licensee enters
into to hedge, counteract or offset the
risk to the licensee associated with a
transaction between the licensee and
the client; and
2. impose record-keeping, reconciliation and
reporting obligations on licensees that
hold “derivative retail client money”.
eToro Australia does not use client moneys paid into
the eToro Australia client moneys trust account for
margining, guaranteeing, securing, transferring,
adjusting or settling dealings in derivatives. Instead,
eToro Australia uses funds
eToro Aus Capital Limited PDS 10 May 2023
from its own operating account for this purpose.
eToro Australia is entitled to place money paid by you into
the eToro Australia client money trust account into
certain permitted investment types, including:
(a) a trust fund;
(b) a money market deposit;
(c) a deposit at interest with an Australian ADI;
(d) for the acquisition of cash management trust interests;
(e) securities issued or guaranteed by the Commonwealth or
a State or Territory;
(f) as deposit with a licensed clearing and settlement facility.
In this case, all earnings relating to such investments will be
retained by eToro Australia. The realization of any investment
may result in the automatic roll-over of the relevant capital into
an equivalent product, or into another investment type listed
above, or to the money being returned to the client money
trust account. Where any losses occur in relation to one of the
investment types listed occurs, eToro Australia shall refund
into the Trust Account any shortfall amount. No fee will be
charged by eToro Australia in relation to such investment.
In practical terms, when you make a payment which is
deposited into the eToro Australia client moneys trust account,
you are making payments held as Margin for your CFDs which
may be withdrawn to be paid entirely to eToro Australia for any
Realised Loss or for fees, charges and costs which you owe to
us.
3.13 Margin payments
You must pay the Initial Margin before the CFD is issued to
you. You must then maintain the minimum amount of Margin
Cover required by us. Separately, you must pay any Variation
Margin when we require.
To pay Margin you must first deposit the funds into the eToro
Australia client money trust account. Your payment is only
effective when we receive your cleared funds and we credit
your Account to reflect the Margin payment.
Here are the key features of Margining that are explained
further in this section:
● You are liable to meet all calls for Margin for your
Account.
● When you have CFDs, you are also liable to meet all
Margin calls for additional payments to eToro Australia.
● This Margin call obligation is in addition to your
obligation to maintain the minimum required Margin
Cover for your Account.
● There is no limit as to when you need to meet your
Margin calls, how often or the amount of the Margin calls.
● The timing and amount of each Margin call will depend on
movements in the market price of the open positions, the
movements in the market price of the Non-margin
13
 product, if used as Margin and the changes to your
account value.
● You have an obligation to meet the Margin call even
if eToro Australia cannot successfully contact you.
● You have a risk of your CFDs being immediately
Closed Out if you do not meet the requirement to
meet a Margin call.
● When you have CFDs, you are obliged to maintain
always the minimum Margin Cover for all of your
CFDs.
● It is your obligation to monitor the minimum
amount of Margin Cover required for your Account.
● It is your obligation to maintain the minimum Margin
Cover always for so long as you have Open Positions.
We are not obliged to notify you about your
obligation, though we may do so by email, telephone
call or otherwise, as a courtesy.
● You have a risk of all your CFDs being Closed Out if you
do not have sufficient Account Value, regardless of
whether you have checked your Account’s
requirement for minimum Margin Cover or whether
you have tried to make a payment but it has not been
credited to your Account.
3.14 Margin Requirement obligation
● You must maintain Margin Cover that meets the
Margin Requirement for your Account.
● There is no grace period as to when you need to meet
Margin Requirement obligations. There is no limit on
how often the Margin Requirement may change.
eToro Australia’s Margin practice is an automated
process by which the eToro Trading Platform sends
warnings to your Account online at different Margin
Requirement levels. The Margin Closeout levels are
stated on our website.
● The timing and amount of your Margin Requirement
obligations for your Account will depend on
movements in the market price of the Underlying
Instrument and the changes to the Account Value.
● You have an obligation to meet the Margin
Requirement even if eToro Australia (by the eToro
Trading Platform or otherwise) cannot successfully or
does not contact you. You must not rely on receiving
any warning from us or you not accessing your
Account.
● You have a risk of some or all your CFDs being Closed
Out if you do not meet the obligation to meet the
Margin Requirement.
● It is your obligation to monitor the Margin
Requirement and the Margin Cover for your Account.
● It is your obligation to maintain the minimum
Margin Cover always for so long as you have an
Open Position in a CFD.
eToro Aus Capital Limited PDS 10 May 2023
● You have a risk of your CFDs (and all other products held
in your Account) being Closed Out if you do not have in
your Account sufficient Margin Cover credited to it,
regardless of whether you have checked your Account’s
Margin Requirement or whether you have tried to make
a payment but it has not been credited to your Account.
3.15 Margin policy
eToro Australia applies the following main Margin principles:
● Each Client is required to have Margin Cover for the
amount known as “Initial Margin” before issuance of a
CFD.
● The Initial Margin is determined by eToro Australia
based on a number of factors, including the Leverage
Ratio applied to an eToro Australia CFD, Margin required
to hedge the underlying market, any margin which eToro
Australia is required to pay its Hedge Counterparty (if
applicable), eToro Australia’s risk assessment of the
Client, and any Realised/Unrealised Loss.
● The Initial Margin could be available either by the Client
paying funds (as Margin) into the eToro Australia client
moneys trust account or because there is already
sufficient Margin held in that account. If there is not
sufficient Margin Cover (including all available Margin)
for the CFD to be opened (due to its Initial Margin
requirement) then the position will not be executed.
● If the CFD is opened, the Client’s Account is adjusted at
any time, often continuously and quickly, for its Margin
Requirement according to market movement so that no
Client is intentionally materially benefited from other
Clients’ trading. This unintended benefit could occur if,
for example, the Client’s Margin requirements are not
adjusted in line with market changes or the credit risk on
the Client.
How is Margin Cover calculated?
eToro Australia sets the amount of the Initial Margin,
calculates the Margin Cover and sets the Margin
Requirement.
The Initial Margin set by eToro Australia can be dependent on
the Leverage Ratio, the type of contract selected by the Client
and calculated as a percentage of the full-face value of the
CFDs.
Ordinarily the Initial Margin requirements are calculated to
cover the maximum expected movement in the market in the
near future but the ongoing Margin Requirement will change
when the market changes and so might not be sufficient in all
circumstances.
Owing to the volatility of the market, the amount of Margin
Requirement to maintain your Open Positions may change at
any time after a position has been opened due to market
changes, changes made to your Account by eToro Australia
(as permitted by the Financial Product Terms) or due to eToro
Australia performing a revaluation for any
Realised/Unrealised Loss or Realised/Unrealised Profit on
14
 your Account. If you have CFDs denominated in a
currency other than the base currency of your Account,
any fluctuations in the exchange rate adverse to your
CFD position can lead to automatic adjustments to your
required Margin Cover, so you need to monitor these
CFD positions very carefully.
You should be aware that you can reach the stage of not
having enough Margin Cover to meet the Margin
Requirement because changes in valuation of your CFDs
are automatic, reflecting the rapid changes in the market
values.
The Margin Requirement is linked to the Margin Closeout
level as the example below explains.
To satisfy the Margin Requirements, you may:
● Close Out existing positions to reduce your Margin
Requirements; or
● pay additional funds as Margin for your Account; or
● a combination of the above.
If the actions taken are not sufficient to maintain the
Margin Cover to meet the Margin Requirement then you
risk some or all your positions being automatically Closed
Out.
Under the Financial Product Terms, your obligations arise
from the time you have an Open Position. If the market
moves so as to increase the Margin Requirements, or
eToro Australia increases the Margin Requirement, you
immediately owe the increased amount of the Margin
Cover, regardless of if or when we contact you to pay
more Margin. Your obligation to maintain the Margin
Cover to meet the Margin Requirement remains at all
times, whether or not we contact you and whether or not
you log into your Account.
You will be required to provide the required Margin Cover
whether or not you receive a Margin call. In other words,
you are responsible for monitoring your positions and
providing the required level of Margin Cover. You might
receive notice about Margin Cover requirements by email,
SMS messages or, when you access your Account via the
eToro Trading Platform, by messages on your screen, but
you need to provide the Margin Cover whether or not you
get that notice from us (including through the eToro
Trading Platform).
The values of your CFD positions are ordinarily marked to
market on a continuous basis, which automatically leads
to corresponding changes in Margin Cover requirements
for your Account. At weekends or at other times when
trading on the Exchange relevant to the Underlying
Instrument is closed, some Margin Cover requirements
automatically increase. You should note that if the
underlying market is not trading then the value might not
change until the market re-opens and there might be a
gap in prices/values at the time of re-opening.
Your Margin defaults
eToro Aus Capital Limited PDS 10 May 2023
If you do not ensure that you maintain the level of Margin
Cover to meet the Margin Requirement, some or all of your
Open Positions may be Closed Out and the resulting Realised
Loss deducted from any proceeds. Any losses resulting from
Closing Out your Open Positions will be debited to your
Account and you may be required to provide additional funds
to eToro Australia to cover any shortfall. If you do not comply
with your obligations, all of your Open Positions can be Closed
Out automatically.
It is your responsibility to pay your Margin on time and in
cleared funds, so please keep in mind the possibility of delays in
the banking and payments systems. If your payment is not
credited by eToro Australia by the time you are required to
have the necessary Margin Cover, you could automatically,
and quickly, lose some or all your positions (and suffer further
losses because of having to meet a shortfall). You should
maintain a prudent level of Margin Cover and make payments
in sufficient time to be credited to your Account. Please see
“Margin risks” in Section 4.
As at the date of this PDS, Accounts can be funded by credit
card, electronic funds transfer and other methods permitted
from time to time. Our available payment methods can be
found on our website.
3.16 Valuation
During the term of our CFDs, eToro Australia will determine
the value of your entire Account, based on the value of the
CFDs and all other Open Positions in your Account. The values
of your CFD positions may be adjusted to reflect the positions
being marked to market when the market or Exchange for the
relevant Underlying Instrument is open.
3.17 Order Types
Different types of Orders are available on the eToro Trading
Platform when you log in. The following are examples of Order
types that may be available to you.
Important notice about this section
When you request one of the types of Orders described in this
section, we have discretion whether or not to accept and
execute any such request. We will, at our discretion, accept or
reject any Orders.
The price at which we accept an Order to trade will generally
be based on filling the full volume of the Order in one
Transaction if possible.
The type of Orders and how they may be filled, if at all, might
depend on the rules of the Exchange where the Underlying
Instruments are being traded or our compliance and
operational filters and configurations. For some CFDs which
you choose to deal in, there may be a minimum trade value or
other restrictions (e.g., pricing) that relate to a particular
market.
References to Orders being filled immediately or positions
being Closed Out immediately or automatically refer to
processing of Transactions as soon as practical in the ordinary
course of electronic processing, and subject to compliance and
15
 operational filters. The speed of electronic processing can
depend on a number of technical factors, including any
transaction filters required for our compliance.
Limit Order
Limit orders are commonly used to enter a market and to
take profit at predefined levels.
● Limit orders to buy are placed below the current
market price and are executed when the Ask price
hits or breaches the price level specified. If placed
above the current market price, the order is filled
immediately at the best available price below or at
the limit price.
● Limit orders to sell are placed above the current
market price and are executed when the Bid price
hits or breaches the price level specified. If placed
below the current market price, the order is filled
instantly at the best available price above or at the
limit price.
When a limit order is triggered, it is filled as soon as
possible at the price obtainable on the market. Note that
the price at which your Order is filled may differ from the
price you set for the order if the opening price of the
market is better than your limit price.
Market Order
A Market Order is executed immediately when placed
(subject to the usual filters and discretions held by eToro
Australia). It is priced using the current spot, or market
price, of the Underlying Instrument.
A Market Order, once executed, immediately becomes an
Open Position, so is subject to fluctuations in the market.
This means that should the market move against you, the
value of your Open Position deteriorates – this is an
Unrealised Loss. If you were to close the position at this
time, you would realise the loss and after that, your
Account Balance would be updated to include the revised
values.
Take Profit Order
A Take Profit Order automatically closes an Open Position
when the price reaches your specified Take Profit Order
price. Take Profit Orders are used to lock-in profits when
you are unavailable to monitor your Open Positions.
For example, if you are long USD/JPY at 109.62 and you
want to take your profit when the rate reaches 110.00,
you can set this rate as your Take Profit Order. If the Ask
price reaches 110.00, the Open Position is closed by the
eToro Trading Platform and your (gross trading) profit on
that closed position is established. Your Transaction is
closed at the current market rate. In a fast-moving
market, there may be a gap between the current market
rate and the rate you set as your Take Profit Order.
Stop Loss Orders
eToro Aus Capital Limited PDS 10 May 2023
eToro Australia may, in its discretion, accept an Order
from you to close a position if the price moves to or
beyond a level specified by you. This is known as a “stop-
loss order”.
You would generally choose to place a stop-loss order to
provide some risk protection. Stop-loss orders are
commonly used to exit positions and to protect
investments if the market moves against an Open
Position.
For example, if your Open Position moves towards
making a loss based on a level chosen by you, the stop-
loss order would be triggered to try to close your Open
Position.
Stop-loss orders to sell are placed below the current
market level and your stop-loss order would be executed,
i.e., triggered if our Bid price (for a stop-loss order that
requires an Order to sell a contract) moves against you to
a point that is at or lower than the level specified by you
(and accepted by us).
Conversely, stop-loss orders to buy are placed above the
current market level and your stop-loss order would be
executed, i.e., triggered if our offer price (for a stop-loss
order that requires an Order to buy a contract) moves
against you to a point that is at or above the level
specified by you (and accepted by us).
All stop-loss orders are subject to agreement by us, so
you cannot be assured that you will always be able to have
a stop- loss order. While eToro Australia has absolute
discretion whether to accept a stop-loss order, it will
generally try to do so, subject to market conditions,
compliance and operational configuration and the
reasonableness of your stop-loss order.
Your Order may be unreasonable if, for example, the level
you have specified is too far away from the market price,
the Underlying Instrument or trading in the Underlying
Instrument has been halted or suspended on the market.
Even if we accept your stop-loss order, market conditions
may move against you rapidly. It is possible that you may
receive the best available price on the market, which is
worse than the one you have requested from eToro
Australia. A gap in market prices reflects the market for
the CFDs, so can occur for any reason, without any
apparent reason or at any time.
Order duration
Orders will remain in effect until either it has been
cancelled by you or us; executed by us; or we no longer
quote the CFD which your Order was placed over.
Typically, eToro Australia offers one main Order duration,
“Good until cancelled”. This is an Order that you have
placed that will remain in effect until it is cancelled by you
(or us).
General
16
 We may cancel, modify, suspend or discontinue,
temporarily or permanently, at any time in our sole
discretion any existing type of Order or the ability to place
any Orders (or both) including without limitation limit
orders such as stop loss, take profit, buy limit and sell
limit orders, either generally or with respect to a specific
Underlying Instruments or with respect to a specific
direction of a specific instrument.
3.18 Short eToro Australia CFDs
When dealing in short eToro Australia CFD positions, you
are highly likely to be affected by the laws and Exchange
rules in the country as they apply to short selling of the
Underlying Instrument.
3.19 Market Conduct
Clients should be aware that some practices in placing
Orders can constitute, or be involved in, market
manipulation or creating a false market which is conduct
prohibited under the Corporations Act or under other
countries’ laws. eToro Australia has policies and
procedures to manage attempts to use Orders and the
eToro Trading Platform to engage in or be involved in,
illegal or otherwise unacceptable market conduct.
It is the Client’s responsibility to be aware of unacceptable
market practices and the legal implications. A Client may
be liable for penalties to regulators such as ASIC or be
liable to eToro Australia for costs to eToro Australia
arising out of those trading practices of the Client, which
lead to the Client, eToro Australia or any other person
suffering loss or penalty.
3.20 Closing a position
Our CFDs do not have an expiry date (unless specified
through the eToro Trading Platform). They remain open
until they are Closed Out. With most CFDs, you can hold
the position for as long as the eToro Trading Platform
permits. This may be for less than a day, or for months.
If you wish to close an Open Position, you enter a new
position that is equal and opposite to the Open Position.
To close a ‘bought’ or ‘long’ position - you sell. To close a
‘short’ or ‘sold’ position - you buy.
At the time that the positions are closed, the eToro
Trading Platform will calculate the remaining payment
rights and obligations to reflect movements in the
Contract Value since the previous business close
(including any other credits/debits). Because you enter a
position to Close Out the existing position, there may be a
fee on the position used to close the position – see
Section 5.
To provide the CFDs to you in an efficient and low-
cost manner, eToro Australia has discretion in
determining closing prices. In general, without limiting
eToro Australia’s discretion, it should be expected that
eToro Australia will act reasonably and have regard to
a range of relevant factors at the time, the closing
price of the Underlying Instrument for the position,
eToro Aus Capital Limited PDS 10 May 2023
any foreign currency exchange rates which are relevant due
to the denomination of the position or Accounts and any
suspension or halt in trading of the Underlying Instrument.
eToro Australia also has the right to decide to make an
adjustment in any circumstance if eToro Australia
considers an adjustment is appropriate. eToro Australia has
a discretion to determine the extent of the adjustment to
place the parties substantially in the same economic
position they would have been in had the adjustment
event not occurred.
eToro Australia may elect to close a position (without prior
notice to you) if an adjustment event occurs and it
determines that it is not reasonably practicable to make an
adjustment.
Although there are no specific limits on eToro Australia’s
discretions, eToro Australia must comply with its
obligations as a financial services licensee to act efficiently,
honestly and fairly.
The amount of any gross profit or loss you make on a
position will be based on the difference between the
amount paid for the position when it is issued (including
fees and charges) and the amount credited to your Account
when the position is Closed Out (including allowance for
any fees, costs and charges).
3.21 Counterparty Risk
When you deal in our CFDs, you have a counterparty risk
with eToro Australia. Because you are dealing with eToro
Australia as counterparty to every transaction, you will
have an exposure to us in relation to each transaction if
we are not ready, willing or able to meet our obligations,
for example, if eToro Australia were to become insolvent.
You should satisfy yourself that eToro Australia is able to
meet its obligation to you. You can assess eToro
Australia’s financial ability to meet its counterparty
obligations by reviewing its financial statements.
You are reliant on eToro Australia’s ability to meet its
counterparty obligations to you to settle the relevant
contract. eToro Australia limits this exposure by hedging
its exposure to its clients by entering into opposite
transactions as principal in the wholesale market in
relation to its exposures with clients. eToro Australia is
then exposed to counterparty risk with that hedging
party.
Please note that eToro Australia does not use client
moneys to hedge any of its positions with its Hedge
Counterparty. Those positions are funded by eToro
Australia’s operating account. eToro Australia will
withdraw your client moneys to pay amounts to which it
is entitled, and pay moneys into the eToro client moneys
trust account for your benefit, following revaluations of
your Account (as explained in this PDS).
An account with eToro Australia is not insured or guaranteed
by the Australian government or any other entity.
17
 Consequently, should we become insolvent there is no
guarantee that your account will maintain its value
(however, please refer to the section 3.12 Clients Money
Rules for further clarification).
3.22 Risks from eToro Australia’s Hedge
Counterparties
eToro Australia operates a market-making model, which
means it may at any time choose to hedge or not to
hedge some or all of its positions and it may change that
at any time (and without disclosing its hedging). Any of
those hedge positions means that eToro Australia will
have one or more Hedge Counterparties, each of which
potentially owes a net amount to eToro Australia.
It is possible that eToro Australia’s Hedge Counterparty
may become insolvent or it is possible that other clients
of that Hedge Counterparty may cause a default, which
reduces the financial resources or capacity for that Hedge
Counterparty to perform its obligations owed to eToro
Australia under the hedge CFDs.
Since eToro Australia is liable to you as principal on the
contract, eToro Australia could be exposed to the
insolvency of its Hedge Counterparty or other defaults
which affect the Hedge Counterparty.
The following information is applicable with respect to
eToro Australia’s the main affiliated Hedge Counterparty
as at the date of this PDS. Please be aware that eToro
Australia does not make any representation that it will
hedge, or that it will hedge only with the following
affiliated Hedge Counterparty.
Hedge Counterparty: eToro (Europe) Limited
Further information: eToro (Europe) Limited is a company
incorporated in Cyprus (registered number HE200585). It
is a regulated financial services company and investment
firm.
It is regulated by the Cyprus Securities and Exchange
Commission (licensee number CIF 109/10) and operates
in accordance with Markets in Financial Instruments
Directive (MiFID) of the European Union.
You should note that:
● eToro (Europe) Ltd has not been involved in the
preparation of this PDS nor has authorised any
statement made in this PDS relating to it.
● eToro (Europe) Ltd has no contractual or other legal
relationship with you as holder of the CFDs. eToro
(Europe) Ltd is not liable to you and you have no
legal recourse against eToro (Europe) Ltd (because
eToro Australia acts as principal to you and not as
agent) nor can you require eToro Australia to act
against eToro (Europe) Ltd.
● eToro Australia gives no assurance as to the solvency
or performance of any Hedge Counterparty.
● The regulation of a Hedge Counterparty is no
eToro Aus Capital Limited PDS 10 May 2023
assurance of the credit quality of the Hedge Counterparty
or of any regulated or voluntary scheme for meeting the
claims of creditors of the Hedge Counterparty. For
example, although a Hedge Counterparty may be
regulated by Cyprus financial services law that gives no
assurance that the Hedge Counterparty has good credit
quality or it will perform its obligations to eToro Australia.
● The credit quality of the Hedge Counterparty can change
quickly. eToro Australia may not be able to make
assessments of the credit quality of its Hedge
Counterparty at the time the changes occur which it can
disclose. Reports by independent credit rating agencies
may not be available because of their lack of consent or
because they are not licensed to allow such reports to be
cited in the PDS given to retail clients.
● eToro Australia may use other Hedge Counterparties and
may do so without prior notice to you of that. For
example, in times of exceptional market difficulties or
communications technology problems, eToro Australia
may decide it is prudent to hedge with other hedge
counterparties other than with eToro (Europe) Ltd.
● If eToro Australia becomes aware that material
information about the Hedge Counterparty changes or a
significant matter later changes, eToro Australia will issue
a supplementary product disclosure statement, or a new
product disclosure statement. If the new information is
not materially adverse to you, eToro Australia will provide
the updated information on its website.
eToro Australia is not authorised to set out in this PDS any
further information published by the Hedge Counterparty and
eToro Australia takes no responsibility for third-party
information about the Hedge Counterparty which may be
available to you. If you require further information about the
Hedge Counterparty used by eToro Australia before deciding
whether to invest in the CFDs, please contact us so we can
provide to you any further information of the Hedge
Counterparty, which is publicly available.
3.23 Solvency of eToro
The risks you have by dealing with eToro Australia cannot be
simplistically assessed by reference to historical financial
information about eToro Australia or its Hedge Counterparty
or general statements of principle.
The credit risk you have on eToro Australia depends on,
whether it systematically manages all Client Accounts on the
same basis, its solvency generally, as well as on the amount
(and kind) of its capitalisation, its cash flow, all of its business
risks, its Client and Instrument concentration risks, its
counterparty risks for all of its business and transactions (not
just the CFDs), its risk management systems and actual
implementation of that risk management.
Your credit risk on eToro Australia will fluctuate throughout the
day and from day to day, including due to the implied credit
risk on its Hedge Counterparty, whose credit risk to eToro
Australia (and so indirectly to you) cannot be assessed or
verified on a continuous basis or perhaps at all.
18
 You should consider all of those factors and not rely
only on past financial statements since that could be
materially incomplete information for your
purposes, not current and therefore potentially
misleading as a guide to the current solvency and
creditworthiness of eToro Australia.
The eToro Australia annual directors’ report and an
audited annual financial report will be available for
inspection free of charge on request by contacting
eToro Australia for an appointment at its offices.
3.24 Payments to you in eToro Australia insolvency
If eToro Australia becomes insolvent, here is how
you could be paid for any net credit balance in your
Account:
● Any moneys in the eToro Australia client
moneys trust account should be paid to you,
after deduction for any amounts properly
payable to eToro Australia for the CFDs or other
financial products or which you have otherwise
agreed are payable to eToro Australia (and
subject to any court orders to the contrary).
● eToro Australia will owe you any remaining net
amount after paying to you your moneys from
the eToro Australia client moneys trust account.
● eToro Australia will need to assess the amounts
prudently available to pay Clients from its own
funds, and may choose to pay out interim amounts
from any available funds.
● The precise amounts and timing of any further
possible payments might not be known until the net
position with its Hedge Counterparty is known and
paid to eToro Australia.
● The position of the Hedge Counterparty depends on
what it recovers from its Hedge Counterparty and
what it owes its clients.
● eToro Australia will need to assess the amounts
prudently available to pay CFD Clients, and may
choose to pay out interim amounts.
● eToro Australia will need to assess fair and
reasonable allocation to Clients, having regard to, for
example any amounts paid from the eToro Australia
client moneys trust account, Account balances and
amounts recovered from its Hedge Counterparty.
3.25 Market Misconduct
Financial markets in Australia are heavily regulated by
ASIC. Some trading practices are considered to be
unacceptable and are prohibited by Australian law. It is
your responsibility to be aware of any prohibited trading
practices and to act in accordance with the law in your
dealings with us. In addition to your legal obligations, we
have certain rights against you as set out in our Financial
Product Terms.

Section 4 – Significant Risks

Dealing in our financial products involves a number of significant risks. You should seek independent advice and consider
carefully whether our products are appropriate for you given your experience, financial objectives, needs and circumstances.

4.1 Key Risks

You should consider these key risks involved in our offering:

KEY RISKS IMPORTANT ISSUES

Loss from Leverage:
You may choose to trade CFDs with leverage that can lead to large losses as well as large gains.
The high degree of leverage offered in our products can work against you as well as for you. The
leveraged nature of the eToro Australia CFDs gives a moderate to high risk of a loss larger than
the amounts you pay eToro Australia as Margin. It can also cause volatile fluctuations in the
Margin Requirements.

You can minimise the risk of losses on positions by monitoring your Open Positions and Closing
Out the positions before losses arise.

Client moneys may be The money which you pay into the eToro Australia client moneys trust account may be
withdrawn to pay eToro withdrawn to pay eToro Australia moneys to which it is entitled. This includes amounts for any
Australia: Realised Losses as well as for any fees, charges and costs.

Those moneys withdrawn to pay eToro Australia are eToro Australia’s moneys (and are not held
for you), reducing the amount of moneys held in the eToro Australia client money trust account
held beneficially for you.

Client moneys held in The money which you pay into the eToro Australia client moneys trust account may be used to

eToro Aus Capital Limited PDS 10 May 2023 19

 permitted investments
may involve different risks
Margin risk:
Foreign exchange risk:
Counterparty risk
eToro Australia:
Cryptocurrency CFD risks:
eToro Aus Capital Limited PDS 10 May 2023
invest in certain permitted investment types. In this case, the risks of such investments may be
greater than where money is deposited with an Australian ADI. In any event, eToro Australia will
repay any shortfall suffered as a result of any such investment, meaning that the amount which
you pay into the eToro Australia client moneys trust account will not be reduced due to these
investments.
You must be able to pay to eToro Australia the amount of required Margin as and when required,
otherwise some or all your Transactions may be Closed Out without notice to you.
Margin Requirements are highly likely to change continuously, in line with market movements in
the Underlying Instrument.
You should be aware that there is a high risk of Margin Requirements changing and at times, very
rapidly. There is a moderate to high risk that if the market value of the Underlying Instrument
moves rapidly against you, you will be required to pay more Margin without eToro Australia
giving you notice of that.
You can minimise your risk of losing your positions after failing to meet Margin Requirements by
carefully selecting the type and amount of CFDs to suit your needs, having risk management
tools in place (such as placing stop loss orders, limit orders or any other Order permitted by
eToro), monitoring the positions, maintaining a prudent level of cash balance in your Account
and providing sufficient Margin within the time required by eToro Australia. Please see Sections
3.13 to 3.15 for further information about Margin.
Foreign currency conversions required for your Account (see section 6 for a further description)
can expose you to foreign exchange risks between the time the Transaction is entered into and
the time the relevant conversion of currencies occurs.
Foreign exchange markets can change rapidly. This exposes you to potentially adverse changes in
the value of your Account, which can be large (depending on foreign exchange rates) and volatile.
This will directly affect the value of a position.
on You have the risk that eToro Australia may not meet its obligations to you under the CFDs. The
CFDs are not Exchange traded so you need to consider the credit and related risks you have on
eToro Australia.
eToro Australia believes that your counterparty risk on eToro Australia is low, especially due to its
feature of paying moneys into the eToro Australia client moneys trust account if there is any
Realised Profit on your Account and due to its Margin policy and risk management which it
implements for the benefit of Clients.
eToro Australia also believes that your counterparty risk is reduced by the additional feature of
eToro Australia not using client moneys to hedge any of its positions with its Hedge
Counterparty. Those positions are funded from eToro Australia’s operating account.
You can minimise your counterparty risk on eToro Australia by limiting the amount you pay
eToro, dealing prudently and requesting payment to you of any surplus in your Account which is
not required for prudent Margin Cover management; however, this approach may increase your
Margin Cover risk, resulting in all of your positions being Closed Out. Please see Sections 3.21 to
3.24.
The prices available for cryptocurrencies fluctuate significantly on any given day and over
time (so your eToro Cryptocurrency CFDs pricing will also fluctuate as significantly and as often).
There is no regulated market for cryptocurrencies. This affects the pricing, liquidity, integrity of
the markets and any exchange used for dealing in the cryptocurrencies which are the Underlying
Instruments. Exchanges offering pricing for cryptocurrencies have little or no regulation or
protections for users of them. Exchanges may be partly centralised, decentralised or some other
combination of order book facilities. These factors affect the pricing, liquidity and cost of
transactions in cryptocurrencies, which can correspondingly affect the pricing of eToro
Cryptocurrency CFDs.
Cryptocurrencies rely on a number of key factors which are not present in other Underlying
Instruments, software for the cryptocurrency, nodes and mining of cryptocurrencies. These are
technical features which are outside the scope of this PDS so you should be familiar with the key
20
 features of cryptocurrencies before dealing in an CFDs in relation to them. None of these are
regulated or backed by any government or voluntary institution, so there are additional risks
inherent in cryptocurrencies, and their predictability is much more uncertain. Cryptocurrencies
have experienced a range of issues, such as forking or delays in transactions, which can affect the
pricing of eToro Cryptocurrency CFDs.

It is possible that some cryptocurrencies may become worthless, leading to your eToro
Cryptocurrency CFDs becoming worthless.

Here is more information about those risks may arise due to the features of our CFDs. Please
note that this PDS does not disclose all of the risks of cryptocurrencies.

eToro Australia does not own or control the underlying software protocols which govern the
operation of cryptocurrencies available as Underlying Instruments for eToro Cryptocurrency
CFDs for trading in our platform. In general, the underlying protocols are open source and
anyone can use, copy, modify, and distribute them. There is no guarantee of their functionality,
security, or availability. The underlying protocols are subject to sudden changes in operating
rules (forks) and other events and transformations, and that such forks, transformations and
other events may materially affect the value, function or even the name of the cryptocurrency.
eToro Australia may, in its sole discretion, temporarily suspend access to CFDs with that
cryptocurrency as the Underlying Instrument; decide not to support (or to cease supporting) the
forked protocol entirely or the cryptocurrency resulting from such event; or to delay offering
CFDs, which means you would not be able to Close Out any Open Positions. In our sole discretion
we may decide (but for avoidance of any doubt we are not obliged to do so) to adjust your
Account in respect of a fork or other event depending on the circumstances of each event
attributable to any specific cryptocurrency. eToro assumes absolutely no responsibility
whatsoever in respect of an unsupported branch of a forked protocol or the cryptocurrency
resulting from such event.

If at any time any of the cryptocurrencies that is an Underlying Instrument for your CFD is
delisted or we no longer support the cryptocurrencies for any reason, then the applicable CFD
may be immediately closed. If eToro is notified that a cryptocurrency which is the Underlying
Instrument for your CFD which you hold in your Account is likely to be delisted or removed or
cancelled from any of the exchanges (some of them or all) and eToro Australia believes that it (or
its Hedge Counterparty) will not be able to trade in such cryptocurrencies, or if there is another
significant disruption to a market for a cryptocurrency or the cryptocurrency itself is subject to a
significant disruption, then eToro Australia may exercise its discretions to adjust the pricing or to
terminate the eToro Cryptocurrency CFD. It will do so in accordance with its obligations and
duties, acting reasonably for the market as a whole, without having to consider any particular
client.

Under certain market conditions, you may find it difficult or impossible to liquidate a CFD
position. This can occur, for example, when the market reaches a daily price fluctuation limit
(“limit move”), if there is insufficient liquidity in the market.

eToro Cryptocurrency CFDs should be seen as a medium to high risk investment. You should
never invest funds that you cannot afford to lose. The maximum leverage provided on
Cryptocurrency CFDs is 2x.

Given the foregoing, cryptocurrencies are not appropriate for all investors. You should not deal in
these CFDs unless you have the necessary knowledge and expertise, you understand these
products’ characteristics and your exposure to risk. You should also be satisfied that the product
is suitable for you in light of your circumstances and financial position.

The risk of loss in trading eToro Cryptocurrency CFDs can be substantial. You should, therefore,
carefully consider whether such that you may sustain a total loss of the funds in your Account. If
the market moves against your position, you may be called upon by us to provide a substantial
amount of additional Margin, on short notice, in order to maintain your position. If you do not
provide the required funds within the time required by us, your position may be liquidated at a
loss.

eToro Australia currently allows trading in eToro Cryptocurrency CFDs over the weekend, though
it may stop that at any time and from time to time. Given that cryptocurrency exchanges might
operate over weekends, there can be a significant difference between Friday’s close and Sunday’s

eToro Aus Capital Limited PDS 10 May 2023 21


4.2 Other Significant Risks
You should consider these other significant risks involved in our products:
SIGNIFICANT RISKS
Market Risk:
Not a regulated market:
Market disruptions:
Orders and gapping:
eToro Aus Capital Limited PDS 10 May 2023
open prices of eToro Cryptocurrency CFDs. All such factors may result in you either not
completing an Order on a specific trading day or completing an Order on a substantially less
favourable price.
You can manage these risks by only investing in eToro Cryptocurrency CFD if you are experienced
in the cryptocurrency, you manage your exposure by limiting your exposure, placing appropriate
orders and carefully and frequently monitoring your Open Positions.
Since your Margin Cover requirements for eToro Cryptocurrency CFDs may be large, and may be
increased over the weekend, you can help to mange your risks by carefully considering the
amount of Margin you have in your Account, the risks of all of your Open Positions and your
capacity to trade or to provide more Margin Cover immediately, even outside of banking
payment hours.
IMPORTANT ISSUES
Financial markets can change rapidly; they are speculative and volatile. Prices of currencies
depend on a number of factors including, but not limited to, commodity prices or central bank
decisions, interest rates, demand and supply and actions of governments.
Our products are highly speculative and volatile. There is a high risk that market prices may move
such that the Contract Value of the position on closing can be significantly less than the amount
you invested in them.
There is no guarantee or assurance that you will make profits, or not make losses, or that
unrealised profits or losses will remain unchanged.
You can reduce your risk by understanding the market relevant to the CFDs, monitoring your
positions carefully and closing your Open Positions before unacceptable losses arise.
The financial products offered by eToro Australia are derivatives and are not covered by the rules
for Exchange-traded CFDs. For example, trading on the ASX is governed by rules applicable to
brokers and generally has the benefit of a guarantee system known as the National Guarantee
Fund which provides protection from fraud or misconduct by brokers in connection with certain
ASX trades. The ASX rules and the National Guarantee Fund do not apply to trading in our CFDs.
Over-the-counter derivatives, such as the CFDs, by their nature may not at times be liquid
investments in themselves. If you want to exit the position, you rely on eToro Australia’s ability to
Close Out at the time you wish, which might not match the liquidity or market price of the
Underlying Instrument.
You can reduce your risk by carefully reading this PDS, the Financial Product Terms and taking
independent advice on the legal and financial aspects relevant to you.
A market disruption may lead to you being unable to deal in our financial products when you
wish, and you may suffer a loss because of that. This is because the market disruption events
which affect the Underlying Instrument will also affect the contract positions on the same or very
similar basis.
Examples of disruptions include the “crash” of a computer-based trading system, a fire or other
Exchange emergency, or an Exchange or government regulatory body declaring an undesirable
situation has developed in relation to series of CFDs or a trade, and suspends trading in those
CFDs or currencies or cancels that trade.
You can attempt to minimise the effect of market disruptions by obtaining information released
by the market relevant to the position and acting after the event as appropriate (if any) to the
position held, such as Closing Out because the values have significantly changed since before the
event.
It may become difficult or impossible for you to Close Out a position. This can happen, for
example, when there is a significant change in the Contract Value over a short period. There is a
moderate to high risk of this occurring.
22

Auto liquidation:
Cancellation for error:
eToro Trading Platform:
Market:
eToro Aus Capital Limited PDS 10 May 2023
eToro Australia’s ability to Close Out a position depends on the market for the Underlying
Instrument. Stop Loss Orders (and other Order types) might not always be filled and, even if
placed, might not limit your losses to the amount specified in the Order, since they are not
guarantees that there will be no loss.
You should consider placing Stop Loss Orders or other Orders that might limit your losses, if such
Orders exists at the time you opened your position, but also closely monitor your Account and the
relevant market in case the Stop Loss Order is not fully filled or not filled at all and you need to
take further action to limit your losses. For further information, see the description on “Stop-Loss
Orders” in Section 3.17.
eToro Australia may without prior notice to you liquidate some or all your Open Positions if the
Account Value balance reaches or falls below the Margin Closeout level applicable to your
Account. This can generate fees and realised losses in your Account.
eToro Australia does not assure you that eToro Australia will act on this right, at any time or in
respect of all or any of your Open Positions. You should not rely on this right to manage your risk
and your obligation to maintain Margin Cover to meet your Account’s Margin Requirement.
The more basic risks to you are that you fail to manage your own Account by maintaining
adequate Margin Requirement, you fail to monitor your Open Positions, you (wrongly) rely on
eToro Australia liquidating your Open Positions or you fail to manage your Open Positions before
the Account Value balance reaches or falls below the Margin Closeout level applicable to your
Account.
You can manage the risk of eToro Australia liquidating some or all your Open Positions, or the risk
of you wrongly relying on eToro Australia to do this, by carefully monitoring your Open Positions,
placing and maintaining prudent Orders (including Stop Loss Orders), if such exists at the time
you opened your position and managing your Open Positions before the Account Value balance
reaches or falls below the Margin Closeout level applicable to your Account.
eToro Australia may void from the outset any Transaction containing or based on any manifest
error or a price, or series of prices, which are subsequently determined to be unrepresentative of
the actual market valuation of the Underlying Instrument. This is exercised in our discretion, so
you have risk of a Transaction later being cancelled, whether or not you were aware that there
was an error in the pricing which we later decide has occurred. In the absence of our fraud or
wilful default, we will not be liable to you for any loss, cost, claim, demand or expense following
any such cancelation.
We consider this to be a low risk, since it does not occur often, but it can occur so you can manage
your risk by monitoring the available prices and your Account.
You are responsible for the way you access the eToro Trading Platform or your other contact with
eToro Australia. If you are unable to access the eToro Trading platform, you will be unable to
trade in our CFDs (including Closing them Out) or you might not be aware of the current Margin
Cover and Margin Requirement and so you may suffer loss (and liable to pay fees) as a result.
eToro Australia may also suspend the operation of the eToro Trading Platform or any part of it,
without prior notice to you. Although this is considered a low risk since it would usually only
happen in unforeseen extreme situations, eToro Australia has discretion in determining when to
do this. If the eToro Trading Platform is suspended, you might have difficulty contacting eToro,
you might not be able to contact eToro Australia at all, or your Orders may not be able to be
executed at prices quoted to you.
There is a moderate to high risk that eToro Australia imposes volume limits on Client Accounts or
limits or filters on dealing in particular CFDs, which could prevent or delay execution of your
Orders, at your risk.
You have no recourse against eToro Australia in relation to the availability or otherwise of the
eToro Trading Platform, nor for technological or software errors or limitations.
The rules of the relevant market (if any) or Exchange govern the trading in the Underlying
Instrument and so might indirectly affect your dealing in the CFDs.
All the rules (if any) of each relevant market or Exchange may be relevant to the CFDs, so you
23
 should consider those rules. The details of those rules are outside the control of eToro and they
may change at any time and without notice to you.

Conflicts: Trading with eToro Australia for its OTC CFDs carries an automatic risk of actual conflicts of
interests because eToro Australia is acting as principal in its positions with you and eToro
Australia sets the price of the CFDs and also because it might be transacting with other persons,
at different prices or rates, or eToro Australia might be dealing with market participants in relation
to its exposure to you or to any aspect of all of its Clients’ Accounts.

You can monitor eToro Australia’s CFD pricing compared with other CFDs which have comparable
terms and by monitoring the underlying market.

Valuations: eToro Australia decides the values of its financial products issues to you. Typically, this is by some
reference to (but not automatically solely derived from) the market value (or, if relevant, index
level) of the relevant Underlying Instrument on the relevant market which in turn affects the price
quoted by any relevant Hedge Counterparty to eToro Australia. eToro Australia does not commit
to providing prices directly from a market.

If the market fails to provide that information (for example, due to a failure in trading systems or
data information service) or trading in the Underlying Instrument is halted or suspended, eToro
Australia determines its value based only on its own information (not market pricing).

Due to the nature of our financial products, eToro Australia’s discretion is unfettered and so has
no condition or qualification.

While there are no specific limits on eToro Australia’s discretions, eToro Australia must comply
with its obligations as a financial services licensee to act efficiently, honestly and fairly. You
therefore have the risk of relying on whatever value is determined by eToro Australia in the
circumstances permitted by the Financial Product Terms.

Regulatory Bodies:
A Client may incur losses that are caused by matters outside the control of eToro Australia. For
example, actions taken by a regulatory authority exercising its powers during a market emergency
may ultimately result in losses to the Client because of the effect of those actions on the
Underlying Instrument and so, will affect the terms of the Client’s contract (with or without any
decision by eToro).

A regulatory authority can, in extreme situations, suspend trading or alter the price at which a
position is settled, which might lead to changes to the pricing for the Underlying Instrument for
the Client’s position.

eToro Australia’s If you fail to pay, or to provide currency for, amounts payable to eToro Australia or fail to perform
powers on default, any obligation under your Transactions, eToro Australia has extensive powers under the Financial
indemnities and Product Terms to take steps to protect its position.
limitations on liability:
For example, eToro Australia has the power to Close Out positions, to decide whether to accept
Orders or to execute them and to determine the rates of interest it charges. Additionally, under
the Financial Product Terms, you agree to indemnify eToro Australia losses and liabilities,
including, for example, in default scenarios.

Although these powers, limits on the liability of eToro Australia and the indemnities you give to
eToro Australia are extensive and potentially expose you to significant risks, eToro Australia must
comply with its obligations as a financial services licensee to act efficiently, honestly and fairly.

You should read the Financial Product Terms carefully to understand these matters.

Operational Risk: There is always operational risk in the CFDs. For example, disruptions in operational processes
such as communications, computers and computer networks, or external events may lead to
delays in the execution and settlement of a Transaction.

We might not be liable to you if losses arise owing to delays, errors or failures in operational
processes outside our control, including but not limited to faults in the eToro Trading Platform or
in the provision of data or services by third parties.

4.3 Negative Balance Protection

eToro Australia provides Negative Balance Protection for your Accounts. This means that at all times, your maximum potential loss

eToro Aus Capital Limited PDS 10 May 2023 24

 would be limited to the balance on your Accounts. The terms on which we offer Negative Balance Protection are set out in our
Financial Product Terms.

If you choose to deposit funds with us, including additional funds in response to a Margin Call or otherwise, then these amounts
will be included as part of your Account balance, and the risk of potential loss will be all of your Account balance at the time
including these additional amounts. On the other hand, if you receive a Margin Call and choose not to deposit additional funds to
satisfy the Margin Call, then your Account balance will not include the amount you would have needed to deposit with us in order
to satisfy your Margin Requirements. However, in such instances, we may exercise our rights to close any or all of your open
Contracts.

eToro Aus Capital Limited PDS 10 May 2023 25


Section 5 – Fees, charges
and costs
eToro Australia derives a financial benefit by entering into
other transactions with other persons at different rates
from those charged to the Client.
5.1 Fees - General
Please be aware that there is no separate “spread”
charged as a fee – it is simply the difference that arises
between the Bid and Ask prices as a result of the rates
chosen by eToro Australia.
The specific details for each CFD (sometimes referred to
as the Trading Conditions) will depend on a range of
factors, including your choice of Underlying Instruments
and their markets. The variable details are available at
http://www.etoro.com/en/customer-service/fees/.
5.2 Finance Charge and Finance Credit adjustments
on CFDs
Finance Charges and Finance Credits are calculated daily
on CFD positions held overnight and are dependent on
the underlying market of the Underlying Instrument and
the actual rates decided by us.
When you hold a position overnight, your Account is
debited or credited the overnight swap or rollover rate
(otherwise known as the Finance Charge or Finance
Credit).
The swap or rollover rate is decided by us by reference to
the interest rate differential between the interest rates
offered by the countries whose currencies you are trading
(by way of our CFDs) plus or minus an amount (referred to
as “spread”) applied by eToro Australia.
Any Open Positions held by you after the relevant hour for
the CFD (as shown on
http://www.etoro.com/en/customer- service/fees/ )
(Overnight Hour), which is considered the beginning and
end of the trading day for that CFD, are considered to be
held overnight and so are subject to overnight fee/credit
as further explained below.
When holding such position open after the Overnight
Hour, an overnight fee/credit will be either added or
subtracted from your Account with respect to such
position.
The overnight fee/credit amount is a constant
fee/percentage of the position value/dollar amount per
units and is based on a number of factors including
among others, whether the Transaction is a buy or a sell,
relevant interest rates, the currency in which it is
denominated, instrument differentials, daily price
fluctuations and other economic and market related
factors.
The overnight fee/credit for each instrument is
eToro Aus Capital Limited PDS 10 May 2023
displayed on http://www.etoro.com/en/customer-
service/fees/ link for each specific Underlying Instrument
on the Trading Platform. Any specific differences or
details may be found there.
Please be aware that since most liquidity providers (which
include global banks, financial institutions, prime brokers
and other market makers) across the globe are closed on
Saturdays and Sundays (their local time), there is no
overnight on these days, but most liquidity providers still
apply interest for those two days. To account for that, we
will book two/three days of overnight fee/credit on the
day relevant for such Instrument as set out on
http://www.etoro.com/en/customer-service/fees/(WE
Overnight Day), which makes a typical Overnight Day
overnight fee/credit a multiple of the amount on the
preceding weekdays, all as set out on
http://www.etoro.com/en/customer-service/fees/. Market
holidays will be charged on a daily basis and not in
advance before the holiday (for instance if any of the
currencies traded has a major holiday).
In deciding whether to open a position for a CFD with a
specific Underlying Instrument, you should be aware of
the overnight fee/credit rates because they will be added
or subtracted(as the case may be) to or from your
Account.
5.3 Interest on cash balances
You do not receive interest on moneys held for you in the
eToro Australia client money trust account. eToro
Australia does not pay any interest on cash balances in
your Account even if paid to eToro Australia by any third
party, unless otherwise agreed in writing.
5.4 Bank Fees
Please be aware that you may incur fees imposed on your
Transaction by your bank or intermediary banks. eToro
Australia is not responsible for these additional charges.
5.5 Conversion fee
eToro Australia will convert any profit or loss of your
Transactions from the trade currency to the currency of
your Account at our current exchange rate which may be
different to the spot foreign exchange rate.
5.6 Charges, External Fees and Taxes
In some cases, there may be fees charged by third party
banks (e.g., bank charges on international payment
transfers and credit card payments) to eToro Australia
which eToro Australia may charge you. These are not part
of our financial products but you might incur them in
relation to your payments to us or receipts from us.
For example, if eToro Australia is charged a credit/debit
card/e-wallet fee for receiving your payment, eToro
Australia will charge you for that (and any GST), and apply
that to your Account.
If there is a chargeback for any payment to your Account
(whether made by you or in your name), you may be
responsible for covering any reversed payments and
26
 charge back fees incurred by eToro Australia.
You are responsible for any transaction duty, GST or
similar goods and services or value added tax
payable in respect of trading in Transactions (except
for any income tax payable by eToro).
5.7 Details and Demonstration account
We encourage you to visit our Trading Platform to
see how the Transactions work and their specific
fees, charges and costs. Our demonstration account
is a free way to see and learn examples.
Section 6 – General
Information
6.1 Accounts denominated in foreign currency
Each Account will be denominated in US dollars or
any other currency permitted by eToro Australia
from time to time.
If you instruct eToro Australia to make a Transaction
denominated in a currency different from the
denomination of your Account currency, eToro Australia
will convert the currency value of your Transaction into
the Account’s currency. Any such conversion is subject to
eToro Australia’s procedures and approval.
The foreign currency conversions can expose you to
foreign currency exchange risks between the time the
Transaction is entered and the time the relevant
conversion of currencies occurs. This will immediately
impact on the margining of your Account, so you must be
careful to understand and to monitor the effect of trading
in products denominated in foreign currencies.
Foreign exchange markets can change rapidly. Foreign
currency exchange rates depend on many factors
including for example, interest rates, currency supply and
demand and actions of government. In some situations,
exchanges of foreign currency may be suspended and
further, may be allowed after a delay and the rates
substantially different due to, for example, government
decisions. These will impact on the rates of conversion set
by eToro Australia.
6.2 Discretions
eToro Australia has discretions under the Financial
Product Terms which can affect your Account Orders and
positions. You do not have any power to direct how we
exercise our discretions.
When exercising our discretions, we will comply with our
legal obligations as the holder of an Australian Financial
Services Licence. We will have regard to our policies and
to managing all risks (including but not limited to
financial, credit and legal risks) for ourselves and all our
Clients, our obligations to our counterparties, market
conditions and our reputation.
We will try to act reasonably in exercising our discretions
eToro Aus Capital Limited PDS 10 May 2023
but we are not obliged to act in your best interests or to avoid
or minimise a loss in your Account, or avoid causing you fees on
Transactions.
Our significant discretions are:
• whether to accept your Order (including to Close Out a
position) or to amend it;
• any risk limits or other limits or filters we impose on your
Account or your trading;
• determining Margin Cover and Margin Requirements,
especially the amount of Initial Margin, and any grace time to
meet any changed Margin Requirement;
• determining values of Underlying Instruments (for opening
and closing positions and for determining Margin Cover);
• setting Bid prices and Ask prices; and
• Closing your positions and setting the Closing Value.
You should consider the significant risks that arise from eToro
Australia exercising its discretions – see Section 4.
Our other discretions include:
• setting our fees and interest rates;
• adjusting your positions for adjustments made in the market
to the Underlying Instrument;
• adjusting, Closing Out or cancelling Transactions or Orders
due to applying our compliance or operational policies;
• setting foreign currency exchange conversion rates;
• opening and closing your Account; and
• interpretation, variation and application of our policies.
Please note that while we have discretions, the Trading
Conditions typically are set or applied for automatic
outcomes, such as Closing Out all of your Open Positions if
your Account does not meet the Margin Requirement.
6.3 Policies
eToro Australia has a number of policies that can affect
your investments. The policies are guidelines that eToro
Australia (including all of its staff) is expected to follow
but policies are not part of the Financial Product Terms
and do not give you additional legal rights or powers.
We may change our policies at any time without notice to
you. We may amend, withdraw, replace or add to our
policies at any time without notice to you. Our policies
might help you understand how we operate but all the
important disclosures are set out in or referred to in this
PDS and the Financial Product Terms set out our
respective contractual rights and obligations so you
should only rely on this PDS and not on the policies.
A summary of our key policies is available by contacting
us, which we will send you by email free of charge.
Our key policies relevant to our products currently are:
• client suitability policy;
27
 • client moneys policy;
• risk management policy (to the extent it applies to
Clients, hedging and Hedge Counterparties); and
• conflicts of interests’ management policy
6.4 Anti-Money Laundering Laws
eToro Australia is subject to anti-money laundering
and counter-terrorism financing laws (AML laws) that
can affect the CFDs. If your Account is established,
eToro Australia may disclose your personal
information and stop or Close Out Transactions on
your Account for the purposes of the AML laws or
under eToro Australia’s AML laws, policies and
procedures, without liability to you for any loss that
arises due to that occurring.
6.5 About eToro Australia
eToro Australia is an Australian incorporated
company, licensed to provide financial services in
OTC derivatives to retail clients and wholesale
clients.
Further information about eToro Australia is
available at www.etoro.com (follow through to the
pages for eToro Australia).
eToro Australia is part of the eToro group of
companies. None of the other companies in the
eToro group guarantee or assure the performance
by eToro Australia of its obligations to you.
eToro Australia also provides or arranges the
services of its affiliates to you. This includes the eToro
Trading Platform and CopyTrading tools. The terms
of these are with the respective service providers,
which are affiliates of eToro Australia domiciled
outside of Australia and subject to their respective
countries' laws, regulations and (if applicable)
investor protections). Such services are covered by
the following documents:
https://www.etoro.com/en/copytrading-authorization/
https://www.etoro.com/customer-service/terms-conditions/
https://www.etoro.com/customer-service/general-risk-
disclosure/
Please note that your CFDs are only with eToro Australia
and, despite using any services from affiliates of eToro
Australia, you are unlikely to have any investor protections
in relation to the CFDs with eToro Australia other than
pursuant to the Financial Product Terms and Australian
law.
6.6 Applications
You apply for an Account by completing an online
application form which accompanies the online access to
the Financial Product Terms.
Accounts can be funded by credit card, electronic transfer,
or other methods permitted by eToro Australia from time
to time. Please note that eToro Australia does not accept
eToro Aus Capital Limited PDS 10 May 2023
cheques or cash deposits.
Funding your Account by credit card has additional risks and
costs for you. By using that payment method, you effectively
would be doubling your leverage by taking credit from your
credit card account and dealing with leverage on your Account.
This can add to the risks and volatility of your positions as well
as potentially higher interest costs on your credit card account.
If you lose on your CFDs, you might not have other financial
resources to repay your credit card account, incurring higher
interest costs and possibly defaulting on your credit card
terms.
Although eToro accepts payments of more than $1,000 from
credit card accounts to fund your Account and for later Margin
payments, please carefully consider whether this payment
method is suitable for your dealing and limit it to what you can
afford.
6.7 Taxation Implications
The Australian Taxation Office (ATO) Taxation Ruling 2005/15
describes the income tax and capital gains tax implications of
trading in CFDs for differences and margin foreign exchange
CFDs.
Our products will have taxation implications for Clients,
depending on the current tax laws and administration, the
nature of the Client for tax laws, the terms of the transactions
and other circumstances. These are invariably complex and
specific to each Client. You should consult your tax adviser
before trading in these financial products.
The following summary assumes that the Client will hold the
contract on revenue account, i.e. the Client will be carrying on a
business of either trading or investing in these types of
financial products or the Client will enter into the financial
products for profit making purposes (or both). This summary
does not consider the taxation position if you enter into the
financial products detailed in this PDS for the purposes of
hedging risks associated with other investments held by the
client on capital account.
If you are entering into a contract for the purposes of hedging,
then the taxation consequences will depend on the nature of
the underlying transaction or the asset or liability which is
being hedged. It is recommended that you obtain your own
professional taxation advice for this scenario.
The following information should be regarded as general
information only.
Profits and losses on our CFDs
Any realised gains derived or losses incurred by you in respect
of a contract ordinarily should be included in your assessable
income. Realisation will generally occur when the right or
obligation to receive or pay on the contract ceases.
When calculating the amount of profit or loss, you need to
consider the difference between the Closing Value and the
Contract Value on commencement of the position and any
fees on Open Positions paid or received by you.
The availability of tax deductions or losses incurred
28
 because of entering into these contacts to offset
current and future year income will depend on your
personal circumstances and you will need to seek
advice from your tax adviser in this regard.
Interest you receive on your Account is likely to be
treated as assessable income for Australian tax
purposes at the time that it is credited to the
Account. If you do not provide your TFN (or ABN if
applicable) or proof of exemption, eToro Australia
may be required to withhold tax from any interest
payment at the highest marginal rate (possibly plus
any levy).
Capital gains tax
A contract for difference is classified as a capital
gains tax asset under the Income Tax Assessment
Act 1997 (Commonwealth) (ITAA). Your dealing in
eToro Australia CFDs will have capital gains tax
implications for you. In calculating any capital gain or
loss in respect of your dealing in eToro Australia
CFDs, it is our understanding that you are entitled to
take into consideration the cost of acquiring, holding
and disposing of the eToro Australia CFD.
Tax file number withholding rules
The tax file number withholding rules only apply to
those investments as set out in income tax
legislation. eToro Australia’s current understanding
is that those withholding rules do not apply to its
financial products; however, if it is later determined
to apply and you have not provided eToro Australia
with your tax file number or an exemption category,
eToro Australia may be obliged to withhold interest
payments at the highest margin tax rate and remit
that amount to the ATO.
Other fees, charges or commissions
If the position gives rise to gains that are assessable
or losses that are deductible, any fees other than
charges or commissions ordinarily should be
available as a deduction at the time they are paid by
the investor and debited against their Account.
Goods and Services Tax
According to the ATO GST Determination
GSTD2005/3, the provision, acquisition or disposal of
a contract for difference is a financial supply under
the provisions of the A New Tax System (Goods and
Services) Tax 1999 and related regulations and is
input taxed, with no GST imposed.
Except for fees and charges as set out in this PDS,
amounts payable for or in respect of positions are
not subject to goods and service tax for Australian
residents. Clients should seek their own
independent advice.
6.8 Cooling Off
There is no cooling off arrangement for our offering. You
do not have the right to return any eToro Australia OTC
eToro Aus Capital Limited PDS 10 May 2023
contract acquired, nor request a refund of the money paid to
acquire the CFD. If you change your mind after entering into a
contract
with eToro, you must Close it Out, pay any Transaction fees
and take the risk of incurring a loss in doing so.
6.9 Ethical Considerations
eToro Australia OTC contracts do not have a managed
investment component.
Labour standards or environmental, social or ethical
considerations are not taken into account by eToro Australia
when making, holding, varying or Closing Out the CFDs.
6.10 Jurisdictions
The distribution of this PDS in jurisdictions outside Australia
may be subject to legal restrictions. Any person who resides
outside Australia who gains access to this PDS should comply
with any such restrictions and failure to do so may constitute a
violation of financial services laws.
eToro Australia may decline applications for Accounts , or for
access to particular kinds of CFDs (such as eToro
Cryptocurrency CFDs) at any time and from time to time due
for any reason, including due to regulations in relation to
Underlying Instruments (such as cryptocurrencies).
eToro Australia’s operations are governed by the laws in
Australia.
6.11 eToro insurance
eToro Australia has a comprehensive insurance policy in place
to cover a variety of different scenarios, some which may assist
in the repayment of deficits arising from dealing in Hedge
Counterparties or if there is fraudulent activity by one of eToro
Australia’s employees, directors or authorised representatives
that results in your money being used in fraudulent activities.
If the insurance policy is insufficient or the insurer fails to
perform its obligations, eToro Australia may not be able to
make the payments it owes to you.
6.12 Dispute Resolution
eToro Australia is committed to providing our clients with
outstanding service. If you have a complaint about the
financial product or service provided to you, please raise the
issue with us by taking the following steps:
1. Contact our eToro Australia Dispute Resolution
Officer and provide the details of your complaint.
You may do this by telephone, email or letter.
2. If your complaint is not satisfactorily resolved, within
three (3) Business Days of receipt of your initial
complaint, please put your complaint in writing and
send it to the Compliance Department at:
eToro Aus Capital Limited Level 3
60 Castlereagh Street
Sydney NSW 2000
29
 or by email at info@etoro.com.au
eToro Australia will make every effort to try to resolve
your complaint quickly and fairly. Complaints received in
writing will be acknowledged within two (2) Business Days
of written receipt of your complaint and we will use our
best endeavours to try to resolve your complaint within
45 days of receipt of your written complaint.
If you are not satisfied with the final response provided
by our Compliance Department, you may exercise your
right to complain to the Financial Ombudsman Service Ltd
(FOS), if your complaint is within its rules. FOS is an
external dispute resolution scheme. The contact details
for FOS are:
Financial Ombudsman Service Limited
G.P.O. Box 3
Melbourne VIC 3001
Telephone: 1300 780 808 Website:
www.fos.org.au
Please note that we will need to respond to your
complaint prior to FOS initiating any investigation into
your complaint.
eToro Australia is a member of the FOS complaints
resolution scheme (No. 40378). The service provided to
you by FOS is free of charge.
The Australian Securities and Investments Commission
(ASIC) also has an Info line on 1300 300 630 which you
may use to make a complaint and obtain information
about your rights.
6.13 Privacy
All the information collected by eToro Australia, in the
application form or otherwise, is used for the purpose of
providing you with the financial products and services,
maintaining your Account, and for the purpose of
assessing whether you would be suitable as a Client.
eToro Australia has obligations under, and has
procedures in place to ensure its compliance with, the
Privacy Act 1988 (Commonwealth).
Significantly, these obligations include the following:
Collecting personal information
In collecting personal information, eToro Australia is
required:
• to collect only information which is necessary for
the purpose described above;
• to ensure that collection of the information is by
fair and lawful means; and
• to take reasonable steps to make you, the
individual, aware of why the information is being
collected and that you may access the information
held by us.
If necessary, eToro Australia may also collect
eToro Aus Capital Limited PDS 10 May 2023
information on directors and shareholders of a corporate
client or agents or representatives of the Client. eToro
Australia may be required by law to collect information,
such as for taxation purposes or to identify persons who
open or operate an Account.
eToro Australia may take steps to verify information given
to it, in accordance with relevant laws, such as consulting
registries, referees, employers or credit agencies. This
information will not be disclosed to any other person
although eToro Australia may disclose this information to
its related bodies corporate or agents in the ordinary
course of eToro Australia providing you with its products
and services.
Using the personal information
If eToro Australia has collected the information from you,
eToro Australia will only use the information for the
purposes described below and above unless you consent
otherwise.
Personal information may be disclosed to:
• any person acting on your behalf, including your
adviser, accountant, solicitor, executor, attorney or other
representative;
• related bodies corporate or agents in the ordinary
course of eToro Australia providing you with its products
and services if you use, or intend to use, services of those
other corporations;
• any organisations to whom eToro Australia outsources
administrative functions;
• brokers or agents who refer your business to eToro
Australia (so that we may efficiently exchange information
and administer your account);
• regulatory authorities; and
• as required or permitted by law or by court order.
This information will not be disclosed to any other person
without your consent.
You may access your personal information held by eToro
Australia (subject to permitted exceptions), by contacting
eToro Australia.
Since eToro Australia is obliged by law to take reasonable
steps to ensure that the personal information used is
accurate, up to date and complete, please tell us
immediately if any of the information provided in this
section changes.
Retaining personal information
eToro Australia takes reasonable steps to maintain secure
protection of all personal information obtained from
misuse, loss, unauthorised access, modification or
disclosure.
30

Section 7 – Glossary
ABN means Australian business number.
Account means your account with eToro Australia
established under the Financial Product Terms, including
all Transactions recorded in them, for using the eToro
Trading Platform.
Financial Product Terms means the terms of your
Account with eToro Australia for all of your Accounts by
which you deal in Transactions (as amended from time to
time). Variations or additional terms may be notified to
you from time to time in accordance with your current
Financial Product Terms.
Account Value means the current value of your Account
equity which is calculated by eToro Australia by
combining:
• the equivalent balance of your Account in the eToro
client moneys trust account;
• the Realised/Unrealised Losses and
Realised/Unrealised Profits;
• indicative costs to Close Out (fees, Finance Charges); and
• the values of Transactions not yet booked.
AML Laws means the Anti-Money Laundering and
Counter- Terrorism Financing Act 2006 (Commonwealth)
and any related regulations, rules and instruments.
Ask means the price which eToro Australia as the seller is
willing to accept i.e. the price at which you can buy the
contract. This is also known as the “offer price”.
ASX means the currencies and other Exchanges operated
by ASX Limited.
Australian Dollars or AUD$ means the lawful currency of
the Commonwealth of Australia.
Balance means the funds or posted credit value available
in an Account that may be used for dealing in the CFDs.
Base Currency is the first currency quoted in a currency
pair, for example in the quote AUD/USD, the AUD is the
Base Currency.
Bid means the price which eToro Australia as the buyer is
willing to accept i.e., the price at which you can sell the
contract.
Business Day means a weekday which is not a gazetted
public holiday in Sydney
CFD means the same as an OTC contract.
Client refers to the person who has an Account with
eToro Australia.
Close Out, Closed Out and Closing Out in relation to a
Transaction means discharging or satisfying the
obligations of the Client and eToro Australia under the
transaction and this includes matching up the
eToro Aus Capital Limited PDS 10 May 2023
Transaction with another Transaction of the same kind under
which the Client has assumed an offsetting opposite position.
Closing Value means the value determined by eToro Australia
by multiplying the number of your contract by the price (or, if
an index, the level) of the contract.
Commodity Transaction means a transaction to buy or sell a
specific quantity of a described commodity or to make a
payment calculated by reference to changes in the level of an
index or interest rate, at an agreed date in the future.
Contract Value means the face value of the contract, and is
calculated by eToro Australia by multiplying the applicable price
(or, if an index, the level) of the contract by the number of CFDs.
Corporations Act means the Corporations Act 2001
(Commonwealth).
eToro Australia CFD means an OTC contract issued by eToro
Australia pursuant to the Financial Product Terms.
eToro Australia client moneys trust account means the bank
account (or any one of several of them) maintained by eToro
Australia as a trust account under section 981B of the
Corporations Act. The moneys held in it beneficially for you are
credited to your Account.
eToro Commodity CFD means an eToro Australia CFD (issued
by eToro Australia pursuant to the Financial Product Terms)
whose Underlying Instrument is a Commodity Transaction.
eToro Cryptocurrency CFD means an eToro Australia CFD
(issued by eToro Australia pursuant to the Financial Product
Terms) whose Underlying Instrument is a cryptocurrency.
eToro FX CFD means an eToro Australia CFD (issued by eToro
Australia pursuant to the Financial Product Terms) which
derives an amount calculated by reference to foreign exchange
rates.
eToro Index CFD means an eToro Australia CFD (issued by
eToro Australia pursuant to the Financial Product Terms)
whose Underlying Instrument is an index comprised of
securities of issuers listed on an Exchange, typically an index
sponsored or promoted by an Exchange.
eToro Share CFD means an eToro Australia CFD (issued by
eToro Australia pursuant to the Financial Product Terms)
whose Underlying Instrument is a share or other Exchange-
traded financial product.
eToro Trading Platform means any of the online trading
platforms provided (or arranged to be provided) by eToro
Australia for accessing your Account and placing Orders.
Exchange means the relevant market or any other exchange or
market on which the relevant Underlying Instrument trades or,
in the case of an index, to which it relates. It includes
unregulated exchanges for cryptocurrencies.
Finance Charge means a charge payable by you in respect of
your Transaction, in accordance with the Financial Product
Terms.
Financial Product Terms means the terms governing both
the OTC contracts and your Account with eToro Australia for all
31
 of your Accounts by which you deal in Transactions (as
those terms are amended from time to time). Variations
or additional terms may be notified to you from time to
time in accordance with your current Financial Product
Terms.
Hedge Counterparty means a person with whom eToro
Australia enters into a hedge contract to hedge eToro
Australia’s exposure to Client positions.
Initial Margin means the amount which you are required
to provide to eToro Australia as the initial Margin to open
a position.
Leverage Ratio means the ratio set by eToro Australia
which enables the Client to open a Transaction with an
exposure referable to that ratio.
Margin Closeout means the automatic Close Out of all of
your Open Positions which occurs if the Balance does not
equal or exceed the Margin Requirement.
Margin means the amount of funds paid to eToro
Australia and credited to your Account as Margin.
Margin Cover means the amount calculated by eToro
Australia as the value in your Account available to meet
your Account’s Margin Requirement and for any further
CFDs. It comprises Margin held in the eToro Australia
client moneys trust account (or in a permitted investment
type) for you and some part (in the discretion of eToro
Australia) of any Realised/Unrealised Loss and any
Realised/Unrealised Profit.
Margin Requirement means the minimum amount of
Margin required to be maintained in your Account before
the Account Value reaches the Margin Closeout level.
Market Order has the meaning given to it in section 3.17
of this PDS.
Open Position means, at any time, a Transaction which
has not been Closed Out, or settled prior to the time
agreed for settlement. Take Profit Order
Order means any instruction provided by you to enter
into a Transaction or to Close Out a Transaction.
OTC means over-the-counter (in contrast with Exchange-
traded).
OTC contract means an over-the-counter contract,
provided pursuant to the Financial Product Terms, for a
financial product, including options and CFDs in respect
of foreign exchange or other commodities, such as
metals. eToro Australia acts as principal to you in your
OTC contracts.
Realised/Unrealised Loss refers to each of the following:
(a) Realised Loss – the amount by which the value of
*** END OF DOCUMENT ***
eToro Aus Capital Limited PDS 10 May 2023
an Open Position on Close Out is less than the value of the
Open Position when the Open Position was last valued or if
the Open Position has never been valued previously, it is the
value when the position was opened; and
(b) Unrealised Loss – the amount by which the value of
an Open Position (not on Close Out) is less than the value
of the Open Position when it was last valued or if the
Open Position has never been valued previously, it is the
value when the position was opened.
Realised/Unrealised Profit refers to each of the following:
(a) Realised Profit – the amount by which the value of
an Open Position on Close Out is more than the value of
the Open Position when the Open Position was last
valued or if the Open Position has never been valued
previously, the value when the position was opened; and
(b) Unrealised Profit – the amount by which the value of
an Open Position (not on Close Out) is more than the
value of the Open Position when it was last valued or if
the Open Position has never been valued previously, the
value when the position was opened.
Take Profit Order has the meaning given to it in section
3.17 of this PDS.
Term Currency is the second currency quoted in a
currency pair, for example for the quote AUD/USD, the
Term Currency is the USD.
TFN means tax file number.
Trading Conditions means the operating rules and
conditions for your trading on the eToro Trading Platform
from time to time.
Trailing Stop Order has the meaning given to it in section
3.17 of this PDS.
Transaction means any of the kinds of CFDs which are
dealt under the Financial Product Terms.
Underlying Index means an Underlying Instrument
which is an index when it is used as the basis for the
calculations of prices for an eToro Australia Index CFD.
Underlying Instrument means the instrument which is
used as the basis for the calculations of prices for your
CFDs. This includes an Underlying Index.
Withdrawable Funds means the amount of cash which
may be paid to you from the Account if requested. There
are Withdrawable Funds only if you have excess Balance
over your Margin Requirement and our fees, charges and
costs owing and payable to us. The amount of the
Withdrawable Funds is the lesser of the Balance of your
Account and the Margin Requirement.
32
 eToro Service

Product Disclosure

Statement 10 May 2023

eToro Service
ARSN 637 489 466

Responsible Entity
eToro Asset Management Limited,
ABN 51 122 005 396, AFSL 319738
Level 3
60 Castlereagh Street
Sydney NSW 2000

eToro Service PDS 10 May 2023 33

 Table of Contents

Section 1 - Important information about this PDS ....................................................................................... 30

Section 2 - Overview of the eToro Service ..................................................................................................... 32
Section 3 – Key features of the Scheme ......................................................................................................... 33
Section 4 - How we invest your money .......................................................................................................... 37
Section 5 - Significant risks .............................................................................................................................. 38
Section 6 - Operation of the Scheme ............................................................................................................. 42
Section 7 - Reporting to Clients ....................................................................................................................... 45
Section 8 - Fees, charges and costs ................................................................................................................ 46
Section 9 - Taxation .......................................................................................................................................... 49
Section 10 - Responsible entity reporting requirements ............................................................................. 50
Section 11 - How to contribute to your Account ........................................................................................... 54
Section 12 - Glossary ........................................................................................................................................ 54

eToro Service PDS 10 May 2023 34

Section 1 - Important information about this PDS
The Service and this PDS

This document is the eToro Service – Product Disclosure Statement (PDS) dated 10 May 2023,
authorised and issued by eToro Asset Management Limited as the responsible entity of the
registered managed investment scheme called the “eToro Service” ARSN 637 489 466.

This PDS offers interests in the eToro Service ARSN 637 489 466, a scheme that is registered with the
Australian Securities and Investments Commission (ASIC) under the Corporations Act.

eToro Asset Management Limited (referred to in this PDS as “Responsible Entity”, “we”, “our” or
“us”) is Responsible Entity of the registered managed investment scheme called the “eToro Service”
ARSN 637 489 466 (also referred to in this PDS as the "eToro Service" or "Scheme”) and the issuer of
this PDS.

The Service is a digital service. Investors, by applying, agree to receive disclosures, reports and
communications in electronic or other digital form.

Please see the Glossary in Section 12 - of this PDS.

General information only

The information contained in this PDS is general information only and does not take into account
your individual objectives, financial situation, needs or circumstances. You should assess together
with your financial adviser (if any) whether investing through the Scheme is appropriate for you
having regard to your objectives, financial situation, needs and circumstances.

Availability outside Australia

The availability of this PDS in jurisdictions outside Australia may be restricted by law. Persons into
whose possession this PDS comes should inform themselves about and observe any such
restrictions. Failure to comply with the restrictions may violate those laws. The availability of this
PDS outside of Australia or the acceptance of an Application by a person who is, or becomes,
resident outside of Australia does not imply that Responsible Entity is licensed in the relevant
jurisdiction outride of Australia or that this PDS is authorised under the jurisdiction’s laws or complies
with laws applying in that jurisdiction for a comparable disclosure document.

We will make available, upon request (sent by email) and free of charge, this PDS and the Additional
Information Statement by sending an online link to an electronic copy of those documents. You may
contact us using the contact details in the Directory at the end of this PDS.

Additional Information Statement

This PDS discloses the information required for a product disclosure statement. Other important

eToro Service PDS 10 May 2023 35

information which is not required to be in a product disclosure statement may be in an Additional
Information Document (also referred to as the AID). The AID (if any) is not incorporated by reference
into or form part of this PDS.

The information in the AID may change between the time you receive this PDS and the time you
acquire an interest in the Scheme (being the time of establishment of your Account). Please ensure
that you read the AID (if any) which is current as at the time you acquire an Account. You should
consider both this PDS and the AID before deciding to apply for an Account.

Account Terms and rules

The Account Terms are the terms of your agreement to use the eToro Service. From time to time
there may be rules for using the Service, such as the Platform, such as order types. These are not
part of the PDS and may later change in accordance with their provisions. You should consider the
Account Terms and any rules before deciding to apply for an Account.

Updating information

Certain information in this PDS may change. We will notify you of any changes that will have a
materially adverse impact on you or other significant events that affect the information in this PDS
(including by providing you with an online link to further information about the changes).

We may issue a new or supplementary PDS in respect of any changes that have a materially adverse
impact on a retail client’s decisions whether to invest (and provide you with an online link to those
documents).

Current documents, including the PDS and AID (if any) and any other general information relating to
the eToro Service, can be obtained free of charge at any time from the help section of the Platform
or the website at www.etoro.com.au

Not responsible

No associates or subsidiaries of Responsible Entity were involved in the preparation of this PDS or
are responsible for its contents.
eToro entities were involved in the preparation of this PDS and provided consent to the statements
about each of them in the form and context in which they are included; however, no eToro entity is
responsible for the issue of this PDS.

Neither Responsible Entity nor any eToro entity, or any of their associates or subsidiaries, or any
issuer of any underlying investment obtained through the Scheme assures or guarantees the
success of the eToro Service or any particular investment, or the repayment of capital or a particular
rate of return, income or capital.

Neither Responsible Entity nor any eToro entity, or any of their associates or subsidiaries, assures or
guarantees the performance of obligations by any issuer of an underlying investment obtained

eToro Service PDS 10 May 2023 36

through the Service, including the payments due by the issuer of an underlying investment.

By applying for an Account, you confirm that you have received a copy of the current PDS and
Account Terms, that you have read them and agree to be bound by the Account Terms and the
Constitution of the Scheme (each as amended from time to time).

Section 2 - Overview of the eToro Service

eToro group

The eToro group of companies provides a leading international trading platform specialising in
capital market investments, which commenced operations in 2007. For more than a decade, eToro
has been a leader in the global Fintech revolution for retail investment in these investments.

eToro entities are regulated by their respective jurisdiction’s regulators, such ASIC, CySEC and the FCA.
For more information on eToro you can visit www.etoro.com.

eToro Service

the eToro Service (also referred to as the Scheme) gives members of the Scheme (we refer to as
Clients) access to the eToro trading platform which has been licensed to Responsible Entity for the
purposes of the Scheme (Platform). The Platform offers Clients a range of short-term and long-term
investment opportunities including Securities Trading.

Since Clients have different risk-appetites, the Platform offers underlying investments varying from
low to high risk. The Platform tools are easy to use, and information about the Scheme is readily
accessible through the Platform.

Since all trading involves risks, and eToro wants Clients to make smart investment decisions, the
Platform offers a wide range of responsible trading features.

About Responsible Entity

eToro Asset Management Limited is Responsible Entity of the Scheme. As Responsible Entity, we
issue interests in the Scheme, and are legally responsible to the Clients of the Scheme for its
operation.

We have appointed eToro entities to provide services for the Scheme, such as licensing the Platform
to us, execution services for any instructions given to us by Clients by the Platform, custody and from
time to time eToro entities will provide support services to assist us in operating the Scheme.

Copy Trading

The eToro group is an international leader in providing various copy trading services, known as Copy
Trading. This service is not yet available through the eToro Service. This PDS does not cover eToro’s

eToro Service PDS 10 May 2023 37

Copy Trading. We will issue a PDS or supplementary PDS to cover eToro’s Copy Trading services
when available through the eToro Service.

Significant benefits of the Scheme

● Scheme structure: your Account is provided through a registered managed investment

scheme. Australia's financial laws apply to the eToro Service. As Responsible Entity of the
Scheme, we have a legal obligation to act efficiently, honestly and fairly in the provision of
financial services to you and to comply with the Constitution.

● Investment choice and diversification: when you are a Client (a member of the Scheme), you
have access to Securities Trading on the Platform. This PDS does not cover the other asset
classes which are available on the Platform.

● Online convenience: your instructions to perform many of the Transactions described in this
PDS can be submitted online through your Account. The Platform provides easy access to
information and reporting, including on the current valuation of the overall portfolio of
Assets designated to your Account, and Transactions for each of your investments and cash
holdings.

Section 3 – Key features of the Scheme

Nature of the Scheme

The Scheme is a registered managed investment scheme in which each member has a separate
Account. In this PDS members are referred to as Clients. The Client’s interest in the Scheme is their
Account. The Assets of the Scheme are designated to the respective Accounts of Clients.

The Securities Trading is available to Clients who have an Account in the Scheme. Applicants may be
required to provide a suitability assessment before they are allowed to use the eToro Service or any
part of it.

The Assets referable to your Account may be held by the Custodian. Records are kept to designate
which Assets are referrable to each Client. Your Assets are also held separately from the assets of
Responsible Entity. Please be aware of two other important features:

● Assets of all Clients may be aggregated when held by any custodian (or sub-custodian). This
means that all assets held by a custodian (or a sub-custodian) are in an omnibus account.
Responsible Entity is responsible for maintaining the records for the segregated Accounts.

● Fractional investing will be available in selected investments (as approved by Responsible

Entity from time to time).

For example, the minimum investment in a leading global “exchange traded fund” might be too
large for a Client. The Service can allocate a fractional investment in a minimum parcel to more

eToro Service PDS 10 May 2023 38

 than one Client, giving each Client an investment that they might not otherwise be able to access.
While each Account is NOT pooled with other Accounts, the investment would be held in an
omnibus account with a custodian (or sub-custodian) on behalf of all Clients who hold a
fractional investment allocation (corresponding to the amount they have invested in that
investment). This might give Clients more investment opportunities and potentially earlier access
to the opportunity.

The key features of the Scheme are summarised in the table below.

Features Explanation

Scheme objective The purpose of the Scheme is to provide investors with access and
exposure to Securities Trading. The Securities Trading service is intended
to be suitable for investors seeking favourable levels of return over the
long term with low levels of volatility.

The Scheme is operated through the Platform and is a digital service

only. By applying for an Account, you agree to receive disclosures,
reports and communications in an electronic format only.

Investment The Scheme offers investment opportunities through the Platform by

Securities Trading.
opportunities
Further information about the investment opportunities in the Scheme
can be found in Section 4 - of this PDS.

Your Account An Account is allocated to a Client after their Application is accepted.

Only Clients who hold an Account may exercise their rights as
members. We do not recognise as members any other person.
You may use your Account to access the Platform and its various
functionalities. Your
Account will contain a record of all Transactions we enter into, or Assets
we hold on your behalf in the Scheme.

Your Account represents the entire relationship between you, as the

Client, and us, Responsible Entity. We may allow you to have separately
designated accounts from time to time. Each is part of your Account.

You do not have an account with any service provider we use, such as an
eToro entity who provides services to us to help operate the Scheme.

Your contributions will remain in your Account until we obtain clear

investment instructions from you, and your selected investments have
been purchased. We may withdraw or otherwise move the funds
designated to your Account in accordance with the Constitution and the
Account Terms, such as when we receive clear instructions from you;

eToro Service PDS 10 May 2023 39

 Features Explanation
your selected investments have been purchased and must be paid for;
to pay our fees, charges, expenses taxes (which you owe to
governments) and to reimburse us (in accordance with the Account
Terms).

Ownership of All Assets held within the Scheme, including those held for your
Assets Account, are held in the name of the Custodian (unless we choose to
hold funds in a bank account in our name). Please be aware that
holding investments through an Account may have different features
and risks (as set out in this PDS) that do not arise for investors directly
holding their investments in their own name.

Minimum We may specify minimum Account balances or conditions from time to

transaction and time.
balance
Refer to Section 6 - of this PDS for information about the minimum
requirements
transaction and balance requirements.

Payments and Base Any payments to us can only be made by an electronic fund transfer.
Currency Any amounts we receive prior to opening your Account will be held in
the applications account and will not earn interest.

Deposits and withdrawals can be by electronic funds transfer or

permitted payment gateway providers.
The Base Currency on your Account is US Dollars (USD). If any of your
investments are denominated in a currency other than your Base
Currency, we will convert the relevant amounts to the Base Currency.
This will be at rates we choose and will be subject to a conversion fee.
Fees and costs Further information about fees and costs can be found on Section 6 -
of this PDS.

Valuation An updated valuation of your Account will generally be available on the

Platform and adjusted during the times when the market or exchange
for the relevant Assets is open.

Leverage and The investments we make on your behalf may attract leverage
margin (if restrictions and margin requirements. You owe us the amounts we
applicable)
owe for the investments we make on your behalf. If you are unable to
meet these requirements we may dispose of or close out these
investments without your approval or that may be done by the service
provider (such as broker or clearing house) for your underlying
investments.

We do not make margin calls (i.e. we will not notify you when you are
required to deposit more margin into your Account). It is your sole

eToro Service PDS 10 May 2023 40

 Features Explanation
responsibility to monitor the money in your Account against your
potential losses, the margin required, and whether your position is
close to your stop level, as we will not notify you when this happens.

Leverage and The investments we make on your behalf may attract leverage
margin (if restrictions and margin requirements. You owe us the amounts we
applicable)
owe for the investments we make on your behalf. If you are unable to
meet these requirements we may dispose of or close out these
investments without your approval or that may be done by the service
provider (such as broker or clearing house) for your underlying
investments.

We do not make margin calls (i.e. we will not notify you when you are
required to deposit more margin into your Account). It is your sole
responsibility to monitor the money in your Account against your
potential losses, the margin required, and whether your position is
close to your stop level, as we will not notify you when this happens.

Distributions Your Account may be credited with income (including interest income
on cash held in your Account) and dividends from investments through
the Securities Trading service.

Corporate actions
The Responsible Entity or Custodian will receive communications relating
to corporate actions affecting the investments held in your Account.
Ordinarily these are on an aggregate basis so they will not be passed
directly onto you. Ordinarily you will not be able to participate in any
corporate actions (which can lead to adverse limitations on your
underlying investments, compared with holding the investments
directly).

In dealing with corporate actions, we will act in the best interests of

Clients in the Scheme as a whole but will not be obliged to consider any
particular Client nor will we be obliged in all cases without fail to act on
any Client’s directions. Our policy regarding corporate actions affecting
securities held in the Scheme is generally that:

● we will adjust your Account to fairly account for distributions

flowing from any distributions and dividends from investments
in shares or ETFs.
● we will generally adopt a neutral position and not vote at
meetings of holders of investments, although we may exercise
our discretion and vote depending on the particular
circumstances; and

eToro Service PDS 10 May 2023 41

 Features Explanation

we will deal with other corporate actions using our discretion, and in
consultation with eToro entities.

Withdrawals Generally, you can make withdrawals out of your Account at any time
subject to certain limits in the Constitution, Account Terms, any other
rules. If any of your withdrawals are denominated in a currency
other than your Base Currency, we will convert the relevant
amounts to the withdrawal Currency. This will be at rates we
choose and will be subject to a conversion fee.

If your Account is closed, all surplus funds in it will be sent to you (or, if
you are uncontactable, held and dealt with as unclaimed moneys). You
withdraw from the Scheme when your Account is closed.

Further information about withdrawals can be found on Section 6 - of

this PDS.

Reporting Clients can access reports through the Platform about their investment
through the Scheme. Section 7 - of this PDS describes the specific
reports which we provide to Clients on a regular basis.

eToro Service PDS 10 May 2023 42

Section 4 - How we invest your money
Investment instructions

Through the Platform, we offer you access and exposure to Securities Trading. We invest your money
based on clear investment instructions we receive from you through the Platform. We will only accept
investment instructions from you.

No personal advice is given by Responsible Entity or any eToro entity to you in relation to the
Scheme. You should consult your adviser before applying to become a member of the Scheme (that
is, have an Account) and before you make a selection of any investment.

Dealing in Securities Trading

Dealing in investments for the Scheme will be undertaken by us (including by an eToro entity acting
on our behalf). Dealings may occur on an aggregate, averaged basis across all Accounts within the
Scheme to take advantage of scale and netting opportunities. All investments will be allocated to the
relevant Accounts on a pro rata basis.

Labour standards, environmental, social and ethical considerations

We do not take into account labour standards and environmental, social and ethical considerations
when exercising our discretion to execute your investment instructions, or follow to any particular set
of standards. We may consider general factors such as, but not limited to, labour relations, potential
environment impacts and whether a target company has clearly defined code of conduct and ethics
policies.

Investment opportunities

Securities Trading

We offer Securities Trading services which allow Clients to invest in securities and other financial
products (without leverage) through the Platform across a range of asset classes, including shares
and ETFs:

● Shares: you may deal in shares through the Platform by opening a buy (long), non-
leveraged position, which means you are dealing in the underlying asset, and the shares are
held by our Custodian on your behalf.

● Exchange-Traded Fund (ETF): this is a financial product comprising several assets grouped
together to serve as one tradable financial product (sometimes an interest in a fund,
sometimes a right more similar to a share with limited rights). Investing in ETFs by opening a
buy (long), non-leveraged position, means you are investing in the underlying asset, and the
ETF is purchased and held by our Custodian on your behalf.

eToro Service PDS 10 May 2023 43

We invest in these types of securities on your behalf based on your instructions to us. It is important
to understand that the Scheme is not an IDPS. While we will generally seek to comply with your
investment instructions, we have the power to delay or to decline your instructions to us and we
decide which investments are available through the Scheme. This means that investment
instructions given by you might not always be actioned. Refer to Section 6 - of this PDS for further
information about our discretions.

Entering into Transactions

The Platform displays indicative prices or quotes to buy or sell securities. We have appointed an
eToro entity to set the (bid and ask) prices of the securities which can be traded on the Platform.
This means that our quotes will be different from the prices provided by brokers, the market price,
as well as the current prices on any exchanges or other trading platforms. We currently do not
charge execution fees, so to compare the total cost of using the eToro Service you should compare
all of the features and fees, charges and costs with all of the features and fees, charges and costs of
services by brokers and other intermediaries.

When you use our Securities Trading services, we will execute Transactions based on your
instructions as soon as reasonably practicable. An eToro entity will execute the Transactions on our
behalf and may from time to time use one or more brokers in the execution process. We too may
choose one or more eToro entities, depending on their respective jurisdictions and investments
which you choose.

Settlement

Your security investments will settle in accordance with local markets. We cannot guarantee that
your execution price will match your order price. We are not liable for any losses, costs or expenses
that you suffer as a result of any delay or change in market conditions either before a Transaction Is
executed, or before a Transaction settles.

All settled Transactions are recorded on your Account and held in the name of our Custodian.

Default before settlement

In the unlikely case that we, an eToro entity or a broker used by them becomes insolvent or commits
another kind of default under their respective agreements, it is possible that settlement of your
Transaction does not occur (because of the provisions relating to that default or due to the rules of
any relevant exchange). In that case the transfer will not be completed so legal title to the
investments will not be obtained by anyone acting on your behalf and you will not get any beneficial
interest in the Transaction's intended underlying investments. This may be the case even if the
securities which you have bought are shown as available in your Account. In these circumstances,
you will be entitled to the amount that you paid for the securities.

eToro Service PDS 10 May 2023 44

Section 5 - Significant risks
Before you make an investment decision, it is important to identify your investment objectives and
the level of risk which you are prepared to accept. This may be influenced by factors such as:

● The timeframe over which you are expecting a return on your investment and your need for
regular income versus longer-term capital growth.

● Your level of comfort with volatility in returns.

● The general and specific risks associated with particular investments.

● Risks associated with the structure through which your investments are made.

As such, it may be important for you to obtain personal advice about your financial circumstances
and needs, as well as the suitability of the Scheme and the investments for you, before you apply to
join the Scheme.

Risk Explanation

Scheme risk There are risks particular to investing in the Scheme including that the
Scheme could be terminated, fees and charges could change (including
increases and additional fees, charges and costs), Responsible Entity could
be changed, the investments offered by the Scheme could be closed or
changed.

The Service is governed by the laws for registered managed investment

schemes and the Constitution, each of which may be amended from time
to time.

Investing Investing though your Account has benefits and risks. The significant risks
through the include the risk that Responsible Entity (including by its agents) does not
Scheme comply with the laws, the Constitution or your permissible instructions.

We use a Custodian which means that the investments referable to your

Account are held in the name of the Custodian. This gives the custody risk
that the custody may be lost, or not settled in the ordinary course, or there
may be errors in allocating investments to your Account.

Investment opportunities may be available because the Custodian is the

legal owner of investments held for your Account. This includes offers only
to wholesale clients (and not also beneficially for retail clients). The
requirements by the offeror for those investment opportunities may differ
and may later change, giving the risks that not all investments may be taken

eToro Service PDS 10 May 2023 45

 Risk Explanation

up, or held, by Responsible Entity.

The wholesale client status of the Custodian may significantly affect the
terms on which financial services or financial products are made available
to the Custodian. For example, shareholder and other corporate benefits
available to registered
shareholders might not be directly passed through to each Client’s Account,
since the Custodian will be the sole registered legal owner of the
investments giving rise to those shareholder benefits.
Similarly, by reason of Responsible Entity being classed as a wholesale
client, other providers of financial services or financial products may
manage their services or deliver products to Responsible Entity, without
documents and client protections for retail clients, so members of the
Service will only have the benefit of Responsible Entity being treated as a
wholesale client in respect of their investments. For example, pre-IPO
offers, rights issues, OTC derivatives, and overseas offers might not have a
regulated product disclosure document or, if they do, might deal with client
moneys (sourced from members, invested in their Account and paid by
Responsible Entity to the other financial services licensee) as client moneys
of a wholesale client (and so not have the protections given to retail client
trust moneys). This has the risk that Clients of the Scheme, while having the
benefit of the opportunity to invest in those opportunities, also do not have
the benefit of retail client disclosures and laws protecting them if they were
directly investing as retail clients.
If possible, Responsible Entity will make available the disclosure documents
of the other financial services provider (including by providing an online link
to where the documents are available).

General risks All investments have an inherent level of risk. Generally there is a trade-off
between higher expected returns for higher expected risk represented by
the variability of investment returns. Investment risk may also result in loss
of income or capital invested and possible delays in repayment. Clients could
receive less than they initially invested and there is no guarantee that they
will receive any return from their investment through the Scheme.

eToro Service PDS 10 May 2023 46

 Risk Explanation

Portfolio Clients may invest in speculative investments with increased levels of

investment risk
investment risk. The value of the Client’s Account in the Scheme may fall or
fluctuate widely which will affect the portfolio of Assets designated to that
Account. Changes in economic, political or market conditions or the
regulatory environment may adversely impact the portfolio of investments.
In addition, other factors may affect particular investments (i.e., interest
rates, exchange rates) and consequently the value of the portfolio of Assets
may fall.

Securities All financial products carry risk, and even trading non-complex products,
Trading risk such as securities, will have a degree of uncertainty. The securities markets
can be volatile, which means the prices of the securities can change rapidly
and be unpredictable.

Scheme The Responsible Entity (including by its agents) may in its discretion do a
operations number of things in the operation of the Scheme, without notice to Clients
and in some cases without taking into consideration the specific issues,
benefits or risks to each specific Client. The Responsible Entity may do this
in its discretion (subject to the Account Terms and the Constitution). This
includes ending arrangements for trading platforms or access to it by any
Client, terminating access to any dealer, product issuer, offering or market
at any time, changing (including limiting) minimum balances or restricting
access to product types.

Regulatory risk
This is the risk that a government or regulator may change the laws or
expectations for accessing investment opportunities, the Scheme or any
other decision which affects the value of investments held in the Scheme.
This includes changes that affect the product issuer, the treatment of
Responsible Entity as a wholesale client for accessing OTC derivatives by a
change in tax or tax administration.

Market risk Economic, technological, political or legislative conditions and even market
sentiment can (and do) change and this can mean that changes in the value
of investments in markets can affect the value of investments in an
Account.

Liquidity Risk Liquidity risk is the difficulty in realising investments held in an Account.
While this is not a direct risk of the Scheme, the use of the Scheme might
have delays or reliance on the personnel of Responsible Entity or of its
agents which add to the risk of non- performance or delays.

eToro Service PDS 10 May 2023 47

 Risk Explanation

Derivative risk
A range of financial derivatives, for example foreign exchange contracts,
futures and options, may be used to implement investment decisions and
to manage risk in an Account in the Scheme. An investment in derivatives is
a sophisticated financial product and can cause a portfolio to make gains or
incur losses that are large in proportion to the money invested in them.
Derivative Transactions may also involve the risk (including credit risk) that
the counterparty on a Transaction will be unable to honour its financial
obligation to Responsible Entity with respect to derivatives held on behalf of
a Client. While Responsible Entity will be directly responsible to the issuer
of the OTC derivative, Responsible Entity holds OTC derivatives referable to
the Client's Account beneficially for the Client. The Client will be fully
responsible to Responsible Entity for all shortfalls and other obligations
rising from Responsible Entity (or eToro acting on its behalf) trading in
those for the Account of the Client. The member may better manage this
risk by fully understanding the OTC derivative, including by reading the
disclosure documents from the issuer, as made available by Responsible
Entity.

Foreign Since the Base Currency of your Account is USD, you are responsible for the
exchange foreign currency exchange risk arising from any conversion of money to or
exposure from USD in or out of your Account. We set the current exchange rates for
any conversions performed. These can differ from any other rates you
think you can access.

Counterparty This risk is the risk that a counterparty in an underlying investment does
risk not meet its contractual obligations. This risk can be managed to some
extent by choosing to deal with counterparties with superior risk profiles,
based on available information and in foreseeable market conditions. You
rely on Responsible Entity to interact with counterparty to investments held
for your Account, but Responsible Entity does not take responsibility for
guaranteeing the solvency or performance of the counterparty.

Other discretion The Scheme vests certain discretion with Responsible Entity, including in
risks the operational implementation of investment, adjustments following
corporate actions, the timing of Transactions, and how to dispose of
investments for termination of the Account.

The timing of cash contributions may not result in investment in portfolio

securities until a later rebalance occurs. This can mean a Client's Account
could be adversely or profitably affected before rebalancing takes place.

eToro Service PDS 10 May 2023 48

 Risk Explanation

The decision to exercise discretions, or not to exercise them, can adversely

or profitably affect the value of the investments in the Account and
therefore also the investment returns. Investors have no recourse to
Responsible Entity or eToro if discretions are properly exercised in
accordance with the Account Terms, Constitution and applicable law.

eToro Service PDS 10 May 2023 49

Section 6 - Operation of the Scheme
Minimum application

We retain the discretion to reject Applications. There is no minimum investment to the Accounts.

Cooling off

There is no cooling off arrangement for the Scheme or for investments made through the Scheme.
This means that you do not have the right to request a refund of the money paid to acquire an
investment through the Scheme. If you change your mind after making a Transaction which is held
an Account, you must close your investment, pay any Transaction costs and take the risk of incurring
a loss in doing so. You can withdraw from your Account at any time any credit balance in your
Account. You can at any time request (in writing) to close your Account. Your positions will be closed,
then your Account will be closed and any surplus will be sent to you.

Selecting investments

We accept no liability or responsibility for any advice given to you by your financial adviser for
investing through the Scheme.

After your Account is established, you send payment as per instructions available at the time. The net
amount which you pay will be credited to your Account, ready for paying for investments which you
choose. We may also accept your instructions to us whereby an eToro entity with whom you have an
account will pay us on your behalf. You select investments and give us instructions to deal in them
on the Platform.

Minimum Withdrawal Amount

The current minimum withdrawal amount is $30.

(If your Account is closed, all of any surplus will be paid to you to satisfy your withdrawal from the
Scheme.)

Our discretions

Our discretions are vested by the Constitution and are in further detail in the Account Terms. You do
not have any power to direct how we exercise our discretions.

When exercising our discretions, we have a legal obligation under our Australian financial services
licence to act efficiently, honestly and fairly. We may have regard to our policies and to managing all
risks (including financial, credit and legal risks) for ourselves and all of our Clients, our obligations to
our counterparties, market conditions and our reputation. We will try to act reasonably in exercising
our discretions, but we are not obliged to act in your best interests or to avoid or to minimise a loss
in your Account.

eToro Service PDS 10 May 2023 50

Our significant discretions include:

● whether to accept your investment instructions;

● to vary the timing for executing your instructions (to allow for efficient Transaction execution,
and manage the fairest and most efficient aggregation of Transactions across all Accounts
so no Client is unfairly materially adversely disadvantaged over time);

● any suspensions, halts or limits we impose on your Account; and

● determining margin requirements for your Account (if applicable).

You should consider the significant risks that arise from Responsible Entity exercising its

discretions. Our other discretions include:

● setting our fees;

● setting foreign exchange conversion rates;

● opening and closing your Account;

● giving you a grace period for full compliance in paying by cleared funds any amount you owe; and

● interpretation, variation and application of our policies.

Reporting

Clients have online access to their Account in order to view the investments, Transaction history, and
fees and charges on their Account. We will also provide any reports required by law.

Applications will only be accepted from persons who agree to receive reporting electronically.

Withdrawing your funds

You will normally be able to withdraw funds on any Business Day and requests will be complied with
promptly, subject to any requirements of the law and as set out below.

All withdrawal instructions must be given to us in an approved form and content by the cut-off each
Business Day.

This is normally 10:00 a.m. (Sydney time), but we can change that deadline in individual cases owing
to market conditions (especially if your portfolio includes stock traded on overseas exchanges). Once you
give a withdrawal instruction, you cannot revoke the instruction unless we give our approval.

Withdrawal of funds from the Scheme can be made in cash (to your nominated bank account). If
the Account is geared, there may be restrictions on withdrawals of investments, depending on the
level of gearing.

eToro Service PDS 10 May 2023 51

To withdraw from the Scheme, all of your Account positions must be closed, then the Account is
closed and the surplus is sent to you.

Method of paying withdrawn funds

Cash withdrawals will be paid using the last available payment method that you used to send funds to
your Account. Any instruction to withdraw to an alternative payment method must be in writing and
signed by you. We may accept it, but only after we are satisfied that the alternative payment method
belongs to you.

We will try to close out or to sell your investments to pay a withdrawal request generally within the
next Business Day or as soon as practicable, following our acceptance of your withdrawal request.

You generally can expect cash to be available within 10 Business Days of our receipt of a satisfactory
withdrawal request. This cannot be guaranteed since there may be delays depending on liquidity of
Assets, market and other factors beyond our control.

Suspension of withdrawals

In unusual circumstances, such as the closure or disruption of a relevant securities exchange, we

may suspend withdrawal from Accounts for the period that these circumstances prevail.

Compliance Committee

We have established a Compliance Committee to oversee the operations of the Scheme and to
monitor compliance with the Compliance Plan. The Compliance Committee is required to report
breaches of the Constitution and the Corporations Act to the directors of Responsible Entity and in
some circumstances to ASIC.

Monitoring your investment

You may access your Account information 24 hours a day, seven days a week through the Platform
(subject to maintenance and emergency disruptions). This is a secured online service that provides
access to access to up-to- date information about your underlying investments, including your
Account balance and Transaction history.

At any time, you may request a Transaction statement for your Account that shows either all
Transactions since your last regular statement or all Transactions for a specific period. We
recommend that you check all statements and Transaction confirmations carefully. If there are any
discrepancies, please contact us or your financial adviser.

Copies of any documents we lodge with the ASIC in relation to the Scheme may be obtained from, or
inspected at, an ASIC office.

Keeping us informed

eToro Service PDS 10 May 2023 52

Our records about you are important. Please inform us in writing of any change to the personal
details that you have given us. This may be a new email or postal address, a change of name or new
bank account details. We will send you written confirmation of any changes that you request us to
make to your personal details.

What happens if you choose not to disclose certain information?

If you choose not to disclose certain information, the following may apply:

● Account details: we will not be able to pay withdrawal proceeds or income distributions to you.

● Tax residency information: we may not be able to process your request, or we may be
required to notify the ATO or other tax authority or to withhold amounts and pay them to
meet tax withholding obligations.

● Incomplete Application Form: unless otherwise agreed, we will not be able to process your
investment request. If you do not provide all relevant identity verification documents, we
will not be able to process your investment request.

Section 7 - Reporting to Clients

Statutory reporting for the Scheme consists of electronic reports available on the Platform.
Applications will only be accepted from persons who agree to receive reporting electronically.

The following reports are made available to Clients in an electronic form:

Portfolio Valuation

This is updated and available on the Platform on a daily basis, and provides you with the total
market value of your portfolio.

Trading Summary

This is available online on a daily basis, and provides a summary of all Transactions.

Expense Reporting

A list of all expenses including portfolio fees, and interest if gearing has been selected.

Important: The reports mentioned above are subject to availability and, at some times Account
information may be out of date pending, for example, completion of a trade, or due to a lag in the
time that a change to your Account is reported electronically.

Confirmations of deposits and withdrawals

By completing the Application Form, you agree that confirmation of acceptance of deposits and
withdrawals involving your Account will be provided to you electronically by means of your Account

eToro Service PDS 10 May 2023 53

which you access online through the Platform.

Scheme financial information

A copy of the auditor’s report for the Scheme will generally be available and published the website
www.etoro.com.au by the end of September each year (or soon after). This report will provide
consolidated information and will not contain any information particular to an individual Client’s
Account. Individual Accounts are not audited. We will provide a copy of this report, or an online link
to it, to you by your email or other electronic address notified in your Application (or as alter advised
and accepted by us).

Section 8 - Fees, charges and costs

Consumer advisory warning

DID YOU KNOW?
Small differences in both investment performance and fees and costs can have a substantial
impact on your long term returns.
You should consider whether features such as superior investment performance or the
provision of better member services justify higher fees and costs.
TO FIND OUT MORE
If you would like to find out more, or see the impact of the fees based on your own circumstances,
the Australian Securities and Investments Commission (ASIC) website (www.moneysmart.gov.au)

This document shows fees, charges and other costs that you may be charged in respect of your
Account. These fees, charges and costs may be deducted from your Account and so reduce the
returns on your investments held in your Account. You should read all the information about fees
and costs because it is important to understand their impact on your investments. Once again, we
urge you to obtain professional financial advice regarding the features and characteristics of the
Scheme and how they may impact you.

Unless otherwise stated, all fees in this PDS are in United States dollars (USD) and are exclusive
of GST.

TYPE OF FEE OR COST

AMOUNT HOW AND WHEN PAID
FOR YOUR ACCOUNT

Establishment fee Nil Not applicable

The fee to open your Account

Contribution fee Nil Not applicable

The fee on each amount

contributed to your Account

eToro Service PDS 10 May 2023 54

Withdrawal fee Nil Not applicable

The fee for withdrawing

from the Scheme (i.e.,
Account closure)

Management costs

Account Management Fee Nil Not applicable

Performance Fee Nil for an Account Not applicable

The above table is for fees, charges and costs for having and closing your Account. Please see below
for an additional explanation of fees, charges and costs on Transactions and related services
for your Account.
Please note this is an example for illustrative purposes only. Additional fees and costs will be charged
depending on the investments that you decide to invest in.

EXAMPLE $50,000 investment made at the beginning of the year with a

contribution of $10,000 during the year with no withdrawal

Establishment Fee Nil

Contribution fee Nil

Withdrawal fee Nil

Termination fee Nil

PLUS

Account Management Nil

Fee

EQUALS Nil We will not charge any fees to

establish or maintain an
Cost of Service Account in the Scheme.
Separately, your Account will be
impacted by other fees,
charges and costs in relation to
[payments and investments,
depending on your investments
on the Platform through the
Scheme. Please refer to the
'Additional explanation of fees
and costs' and the link below
which provides a detailed list of

eToro Service PDS 10 May 2023 55

 applicable fees, charges and
costs:
http://www.etoro.com/en/customer-
service/fees/

Additional explanation of fees, charges and costs

Transactional charges

Transaction charges cover the costs of buying and selling investments in your Account, and are made
up primarily of brokerage payable in respect to sale and purchase Transactions, but may also,
depending on the jurisdiction in which those Transactions are effected, include Government taxes,
bank charges and stamp duty (if any). These costs are incurred when Transactions are effected.

We will not charge any Transaction fee, charge or cost unless notice is given of that. Any government
tax or charge or exchange fee will be charged to your Account.

Payment withdrawal charges.

We will charge you $5 for payments made for withdrawals from your Account. Please access the link
below which provides a detailed list of the current applicable fees, charges and costs:
http://www.etoro.com/en/customer- service/fees/

Other applicable fees, charges and costs

You may be charged (to your Account or directly to you) other applicable fees, charges and costs
depending on your investments on the Platform through the Scheme. These include:

● Payment transfer fees – we may charge you a transfer fee if you pay money into your Account
and your payment method charges us a fee, for example a payment transfer or a payment
processing fee. We may also charge a transfer fee if we return any money which comes in
from a payment method that is not in your name, and we are charged a fee for returning
your money. We may deduct an amount equal to that fee from the money which we are
returning.

● Conversion fees – Since the Base Currency of your Account is USD, if we need to convert your
money to or from USD in or out of your Account we may charge you a conversion fee.

eToro Service PDS 10 May 2023 56

● Inactivity fees – we may charge you a monthly inactivity fee, if there has been no investment
activity on your Account for at least 12 months.

Other fees may also apply to your specific investments. For more information on the above fees and
charges relating to your investments through the Scheme, and worked examples demonstrating
how these fees may apply to you can be found on the website: http://www.etoro.com/en/customer-
service/fees/.

Is Spread a fee, charge or cost?

No. The spread is the difference between the bid and ask (or the “sell and buy”) price. This is not a
separate fee, charge or cost to you. The spread reflects the conditions and at the time of reporting
them to you. The prices change, often quickly and with greater variation (that is, the spread can
move and widen or narrow). If the price at which you sell your investment is less than the price at
which you bought the investment plus taking into account any other fees, charges or costs on your
payment and investment, you will loose on your investment. You should therefore consider that
movements in the spread will impact the availability of any net profit when your positions are closed
out.

Taxes

We may deduct applicable taxes from your Account.

Can fees and charges change?

All fees and charges can change.

The Constitution sets the maximum fees we are entitled to charge. The Constitution restricts
Responsible Entity to receive and retain for its own use out of the Account an account management
fee of up to a maximum of 2% of the gross asset value of the Account at the end of the month.

The fees currently applicable to your investment are set out in this PDS. Although we have the right to
change our fee structure, we have no present intention to do so. If we do change our fee structure we
will provide you with a minimum of 30 days’ notice of any increase. We can notify you by posting the
information on our website, by email or referring to these changes in your Account.

Individual fee arrangements

We may also individually negotiate fees with investors classed as “wholesale” or “professional”
investors on the basis of the value of their investments. We may also offer reduced fees to
employees of Responsible Entity and its related bodies corporate. We cannot enter into individual
fee arrangements with other investors.

Interest on Application Moneys

If for any reason your Application to participate in the Scheme is not immediately accepted when

eToro Service PDS 10 May 2023 57

your application money is received, your Application money will be placed into a bank account until it
is transferred to your Account. We retain any interest paid on this bank account, even if the
investment does not proceed for whatever reason, to cover the costs associated with maintaining it
and for administrative convenience.

Section 9 - Taxation
Taxation law is complex, and its application will depend upon your individual circumstances. The
information we provide should be used as a guide only and does not does not constitute
professional taxation advice. We recommend that you obtain your own professional advice
regarding your tax position with respect to your investment through the Scheme.

Taxation of the Scheme

The Scheme is not taxed since all investments are beneficially held by Clients directly in their separate
Accounts. You have a vested and indefeasible interest in your Assets held through the Scheme.

All net income and gains (or losses) on investments and other Assets in your Account accrue directly
to you. You will generally be required to include in your assessable income your income from the
Scheme. There may be instances where your taxable income from the Scheme exceeds the
distribution you receive from the Scheme.

Tax on Income for Australian Clients

Depending on the types of investments made, your Account can derive income in the form of
dividends, interest, gains on the disposal of investments and other types of income. Generally, such
income is taxable, but tax credits (for example, franking credits or foreign tax credits) may be
available to offset part or all of any resulting tax liability.

If you receive franking credits your entitlement to use those credits to offset tax or obtain a refund
of tax may be affected by your holding of the underlying shares which resulted in the credits.
Generally speaking you must hold the relevant shares at risk for more than 45 days (90 days for
preference shares) to be entitled to the credit. There are exceptions to this rule, and you should
consult your tax adviser for further information.

Tax on Capital Gains for Australian Clients

The disposal of investments in your Account may give rise to a capital gain or loss. These disposals
may be triggered by an investment instruction, a rebalancing of your Account, or your withdrawals
from the Scheme.

Providing your Tax File Number

The Application Form requires you to quote your Tax File Number (TFN), TFN exemption or
Australian Business Number (ABN). If you choose not to do so, we have to deduct tax at the highest
marginal tax rate plus any relevant Government levies (including the Medicare levy) from any

eToro Service PDS 10 May 2023 58

income we received on your behalf.

Goods and Services Tax

Goods and Services Tax (GST) may apply to the Scheme or your investment. Unless otherwise stated,
all fees and costs incurred in the operation of the Scheme are quoted inclusive of any GST.

Section 10 - Responsible entity reporting requirements

The Scheme is not currently a disclosing entity as defined under the Corporations Act. If it were to
become a disclosing entity during the currency of this PDS, the Scheme would be subject to
additional regular reporting and disclosure obligations. Copies of documents lodged with ASIC to
comply with these requirements may be obtained from, or inspected at, an ASIC office.

You have a right to request a copy of the Scheme’s half yearly financial report and any continuous
disclosure notices lodged with ASIC, in addition to the annual audited financial accounts for the
Scheme.

Our legal relationship with you

We hold an Australian Financial Services Licence which authorises us to operate the Scheme.

We can retire as Responsible Entity on 30 days’ notice or we can be removed in accordance with the
Corporations
Act.

Constitution

Our responsibilities and obligations as Responsible Entity of the Scheme are governed by the
Constitution, as well as the Corporations Act and general trust law.

Under the Constitution, a Client has the beneficial interest in the Assets held for their Account. The
legal interest is held by us or, if we use a Custodian, our Custodian.

You may obtain a copy of the Constitution free of charge by requesting a copy from us.

The Constitution contains a number of provisions relating to the rights, terms, conditions and
obligations imposed on both Clients and us, including a provision that Clients and all persons
claiming through them are bound by the terms of the Constitution.

The main provisions which relate to your rights under the Constitution include:

● your entitlement to the Assets and cash credited to your Account;

● your right to withdraw from the Scheme;

● your entitlements upon withdrawal or winding up of the Scheme;

eToro Service PDS 10 May 2023 59

● your rights to attend and vote at meetings of the Scheme;

● our ability to restrict you from transferring or registering security interests (such as
mortgages) over your Account. There are also provisions governing our powers and duties.
These provisions set out:

● the circumstances in which the Scheme can be terminated, including the termination date
which is 80 years less one day after the Scheme is established unless terminated earlier. We
can terminate the Scheme by giving the notice required by the Constitution. If we do, you
receive the investments in your Account (or their cash equivalent) less any expenses
attributable to your Account and your pro rata share of the Scheme expenses;

● our right to be paid by, or receive a benefit from, an incoming Responsible Entity, and not
be required to account to Clients for such payment or benefit;

● when we can amend the Constitution (generally we can only amend the Constitution if we
reasonably believe that the changes will not adversely affect your rights as a Client;
otherwise, the Constitution can only be amended if approved by special resolution at a
meeting of the Clients);

● our right to refuse to accept Applications to participate in the Scheme;

● our right to determine minimum application, withdrawal and holding amounts and powers
in support of these minima;

● our ability to terminate your participation in the Scheme if you breach any terms and
conditions of the eToro Constitution or your Account Terms;

● our right to deduct amounts you owe us from your Account;

● your right to give us instructions. It is important to understand that the Scheme is not an
IDPS and, while we will generally seek to comply with your investment instructions, we
maintain the right and power to determine which investments may be available for you to
invest in on your behalf through the Scheme; and

● our broad powers including to act on properly authorised instructions, invest, and generally
manage the Scheme. Our powers to credit your Account with:

● all moneys you pay into the Scheme;

● all other moneys and assets that we receive from you or on your behalf in relation to your
Account;

● any investments acquired on your behalf in relation to your Account; and

● such other amounts and assets that we determine to be appropriate to credit to the

eToro Service PDS 10 May 2023 60

 Account. Our powers to debit your Account with:

● all moneys paid out to you;

● any moneys required to settle an investment Transaction for you;

● any moneys required for the payment of fees, charges, expenses and taxes associated with
your Account or instructions;

● any Assets disposed of on your behalf; and

● such other amounts as we determine to be appropriate to debit to the Account.

The Constitution provides that Responsible Entity is indemnified for all expenses and liabilities we
incur in relation to your Account in the proper performance of our duties under the Constitution. All
liabilities, which in our opinion are attributable to you or your Account, are to be satisfied from
either or both of the following:

● from your Account; and

● from you by invoice.

The Constitution also deals with our liabilities in relation to the Scheme for example, subject to the
Corporations Act:

● we are not liable to Clients for any loss provided we did not act negligently or we believed
we acted in good faith in accordance with the law and the Constitution; and

● our directors and officers are not liable to a Client or any other person in connection with
the office of Responsible Entity, trustee, or director or officer of Responsible Entity.

Compliance Plan

We have lodged a Compliance Plan for the Scheme with ASIC. The Compliance Plan sets out the
measures we will take to ensure we comply with the Corporations Act and the Constitution for the
Scheme.

To oversee compliance with the Compliance Plan, we have established a Compliance Committee.
The Compliance Committee is required to report breaches of the Constitution and the Corporations
Act to the directors of Responsible Entity and in some circumstances to ASIC.

The Compliance Plan may be altered from time to time in our discretion. The Scheme and the
Compliance Plan are required to be audited annually.

Other parties

Clients have a beneficial interest in the Assets held in their Account. We have engaged a Custodian to

eToro Service PDS 10 May 2023 61

hold the legal title

to Assets of the Scheme. The Custodian will hold the assets in accordance with the standards and
legal obligations which apply to it.

The Scheme has a registered company auditor. The auditor’s role is to provide an audit of the
financial statements of the Scheme each year, as well as performing a half-yearly review (if
required), and to provide an opinion on the financial statements.

Insurance

The Responsible Entity has professional indemnity insurance in place to cover a variety of different
risks, some of which may assist in the repayment of deficits arising if there is fraudulent activity by
one of our employees, directors or authorised representatives that results in your money being used
in fraudulent activities.

Enquiries and disputes

If you have a query, complaint or dispute, please contact eToro Service who may be able to deal it in
the first instance on your behalf.

If you have a complaint that is not, or cannot be, resolved by eToro Service, you can contact the
Responsible Entity using the contact details provided in the directory section of this PDS.

Please provide us with all information relevant to the complaint that is in your possession or control.
We will acknowledge receipt of the complaint as soon as practicable but in any event within 5 days
of its receipt.

We will deal with any complaint and respond to you as soon as practicable and may ask you for
further information that we think is necessary to enable us to properly consider the complaint. Your
complaint will generally be dealt with within 45 Business Days after receiving the complaint.

If your complaint is not dealt with to your satisfaction within this timeframe, you may refer your
complaint to the Australian Financial Complaints Authority (AFCA), an approved external dispute
resolution scheme, of which Responsible Entity is a member.

AFCA’s contact details are:

Website: www.afca.org.au

Email: info@afca.org.au

Telephone: 1800 931 678 (free call)

In writing to: Australian Financial Complaints Authority, GPO Box 3, Melbourne VIC 3001

Anti-Money laundering

eToro Service PDS 10 May 2023 62

To comply with Australia's anti-money laundering and counter terrorism financing laws (AML laws),
we will undertake appropriate identification and verification processes on Applicants for the
Scheme, which may include the identification of underlying beneficial owner(s). We may delay or
refuse to accept an Application (and return any money received with the Application without interest)
from an Applicant who delays or fails to produce any information we request for verification
purposes, or if we are concerned that the Application may breach any obligation of, or cause us to
commit or participate in an offence under the AML laws – we will incur no liability to you if we do so.

Your Application Form will not be accepted or processed until all required information has been
received to our satisfaction (including any additional information that may be requested) and we are
satisfied all client identification procedures have been completed and our obligations under the AML
laws have been complied with. We may also require you to provide additional information and
identification documents to those listed in the Application Form, for example, if you nominate a
foreign bank account in your Application Form. This may include, but is not limited to the following
information:

● for an individual - any maiden name or former name;

● for an individual - countries of citizenship and residence;

● for an individual - occupation and employer or business activity; and

● for all types of investors - source of funds and beneficial ownership.

By applying to open an Account:

● you warrant that you are not aware and have no reason to suspect that:

● the monies used to fund your investment have been or will be derived from or related to
any money laundering, terrorism financing or other illegal activities, whether prohibited
under Australian law, international law or convention or by agreement as illegal activity; or

● the proceeds of your investment will be used to finance any illegal activities; and

● you warrant that you are not a 'politically exposed' person or organisation for the purposes
of any AML laws; and

● you undertake that you or your agent will provide us with all additional information and
assistance that we request in order to comply with our obligations under any AML laws.

Privacy

The information requested on the Application Form is used by us for the primary purpose of
establishing and administering your Account. We may be unable to process your Application or
operate your Account without this information. Our Privacy Policy detailing our handling of personal

eToro Service PDS 10 May 2023 63

information is available upon request. You may request access to the information held by us about
you and your investments, and we ask that you advise us of any changes to such information you
may have provided.

We may disclose your information to external parties who act on our behalf in the operation of the
Scheme from time to time. We may also disclose your information to external parties on your behalf,
such as your financial adviser.

Our Privacy Policy can be found on https://www.etoro.com/customer-service/privacy/ and a hard

copy is available upon request. You may contact eToro Service if you wish to update or request
access to your information or if you have any queries regarding our Privacy Policy.

Section 11 - How to contribute to your Account

To make an investment through the Scheme and open your Account, you must complete the
Application Form which can be obtained from https://www.etoro.com/accounts/sign-up. Cash
deposits involving your Account will be provided to you electronically by means of your Account
which you access online through the Platform. Any amounts we receive prior to opening your
Account will be held in our applications account and will not earn interest.

Section 12 - Glossary
$ and USD means United States dollars.

ABN means the Australian Business Number.

Account means an interest in the Scheme which is the account service provided through the Scheme.

Account Terms means the terms of the agreement governing our relationship with you in relation to
your account(s) held in the Scheme.

Additional Information Statement or AID means the statement or statements about the Platform
or in relation to the Scheme which does not need to be in this PDS (including not incorporated by
reference in this PDS).

AFCA means the Australian Financial Complaints Authority.

Application means the application made in the Application Form to have an Account on the Account
Terms.

ASIC means the Australian Securities and Investments Commission.

Assets means any underlying investments (including, derivative financial products), income or cash
contributions that are referable to a Client's Account in the Scheme.

ATO means the Australian Taxation Office.

eToro Service PDS 10 May 2023 64

Base Currency means the nominated currency which is US Dollars (USD) for your Account in the Scheme.

Business Day means any day (except Saturdays and Sundays) on which banks in Sydney, Australia
are open for normal banking business.

Client means a member of the Scheme by reference only to the registered name of the Account,
subject to any law which extends that meaning.

Compliance Plan means the compliance program of the Scheme which we are required by law to
establish and to maintain.

Copy Trading means a service offered through the Scheme by which Clients instruct us to copy the
trades of other Traders on the Platform. (This is not yet available.)

Corporations Act means the Corporations Act 2001 (Commonwealth).

Custodian means any custodian appointed from time to time by Responsible Entity.

CySec means the Cyprus Securities and Exchange Commission.

ETFs means exchange traded funds which are financial products.

eToro entity means any company in the eToro group.

FCA means the Financial Conduct Authority.

GST means Goods and Services Tax as defined in A New Tax System (Goods and Services Tax)
Act 1999 (Commonwealth).

IDPS means an investor directed portfolio service as defined in ASIC Legislative Instrument [CO 13/373].

NAV means the net asset value of the investments held in your Account as determined in accordance
with the Constitution.

OTC means “over-the-counter”, in contrast with traded on a regulated exchange.

PDS means this Product Disclosure Statement as amended from time, including any supplementary
disclosure documents.

Platform means the electronic facility provided by us to Client for Client mainly to access information
about their Account, to give instructions and to facilitate payments by and to Client in relation to their
Account.

Scheme or eToro Service means the registered managed investment scheme, eToro Service ARSN 637
489 466.

eToro Service PDS 10 May 2023 65

Securities Trading means a service offered through the Scheme where you can instruct us to trade in
securities through the Platform.

TFN means the Tax File Number of an applicant or Client of the Scheme.

Transaction means any transactions or orders with respect to an underlying investment which we

may execute through the Platform on your behalf in accordance with the instructions we receive

from you.

USD refers to any amount denominated in US dollars.

Directory
eToro Service:
General enquiries: 1800 778 439
Email enquiries:
info@etoro.com.au

Responsible Entity and Issuer

eToro Asset Management Limited, ABN 51 122 005 396, AFSL 319738
Level 3
60 Castlereagh Street
Sydney NSW 2000
Telephone: 1-800 778 439
Email: info@etoro.com.au, or through our website at www.etoro.com

Custodian
eToro (Europe) Ltd
4 Profiti Ilia Street, Germasogeia, Limassol, Cyprus.

Auditor of the Scheme

Lachlan Nielson Partners Pty Limited
Level 18, 201 Kent Street
Sydney NSW 2000

None of the entities listed in the Directory above guarantee the repayment of capital or the
performance of the eToro Service offered by this PDS.

All entities mentioned in this PDS other than Responsible Entity have given their consent (and not
withdrawn it) to being mentioned in PDSs for the Scheme in relation to the context of their role.

*** END OF DOCUMENT ***

eToro Service PDS 10 May 2023 66